DALLAS—Nationally, monthly employment growth has exceeded 200,000 jobs for the past nine months. Locally, the progress has been more variable, and one indicator of this is the correlation between job growth and rent growth, which dovetail 83% of the time.

When these two statistics don't jibe, a market experiences “high job growth and low effective rent growth or vice versa, according to a report from Dallas-based Axiometrics, which examined the top 54 apartment markets to see how each fared. “In such situations, something other than job growth influences effective rent growth.”

Of those 54 markets, 15 saw job growth that ranged from weak to negative during the third quarter, and accordingly barely registered effective rent growth during that time period. Detroit and Albuquerque had job growth of -0.2% and -0.3%, respectively, in Q3, and rent growth in both markets lagged the national average by 110 basis points to reach 2.8%, compared to 3.9% for the US a whole.

Faring slightly better, albeit still in the bottom quadrant, were Chicago and Philadelphia. Both cities managed effective rent growth of 3.1% in Q3, on top of job growth of 1% and 0.5%, respectively.

At the other end of the spectrum were 20 markets that managed strong growth in both employment and effective rents during the quarter. Unsurprisingly, the Texas trinity of strong job growth markets—Axiometrics' home base of Dallas, Houston and Austin—were part of this group. These cities had high Q3 job growth (3.8% in Dallas, 4.0% in Houston and 3.8% in Austin, as well as above-average effective rent growth: 4.4%, 5.2% and 4.6%, respectively.

Also in that number are Denver, San Jose and Oakland, all of which with effective rent growth that's significantly higher than the national average, at 9.3%, 9.8% and 10.8%, respectively. These markets also saw Q3 job growth above the national average.

In 12 markets, however, QQ3 saw strong job growth but rent growth below the national average. Bridgeport, CT has job growth of 2.0%, while effective rents declined by 2.9% during the quarter. Similar stories, albeit to different degrees, could be told about Oklahoma City and Raleigh, NC.

There's a common factor in all three cities, and that's apartment delivery that has outpaced demand. In Raleigh, for instance, year-to-date delivery is more than twice the long-term average. “The imbalance between supply and demand is making it more difficult to raise rents and is leading to negative effective rent growth,” according to Axiometrics.

Then there were five markets with strong effective rent growth but job growth below the national average: Tampa, FL; Los Angeles; Oxnard, CA; Charleston, SC; and Birmingham, AL. Here, it's a case of demand exceeding new supply. In Charleston, for instance, supply lagged demand by 524 units last year, and 2014 is shaping up to be more of the same.

While supply is continuing to increase across the US, the most recent Emerging Trends forecast from the Urban Land Institute and PricewaterhouseCoopers notes that “a disproportionate share of new construction is at the high end. This makes sense when urban high-rise property in the gateway markets is priced at 20% to 30% percent more than the cost to construct.” And while this can lead to some excesses—ULI's report cites what some observers see as overbuilding of luxury apartments along the Boston waterfront—such development does not occur in a vacuum.

The ULI report notes that as “a screening device,” one investor surveyed looks for markets with strength in the so-called STEM segment: science, technology, engineering and math. This usually signals the presence of “a big research university drawing young tech and engineering talent in need of apartments, with salaries that are attractive to the owners of rental complexes.”

Yet ULI's report notes that multifamily's real strength is that “it is not dependent upon just one demand segment. As local economies grow and the number of jobs rises, rental housing is required. This is not rocket science.”