Five years of analyses show rents will continue to rise until2003 when an overall economic slowdown is predicted to occur, basedon second-quarter findings that compare annual market rental growthto actual rents. The firm, headed by Murray Ross and Ron Johnsey,counts among its 50-plus client roster REITs, investment firms andproperty management companies. The Axiometrics model has been"warmly received ... from the guys who understand the math," Rosstold GlobeSt.com.

The markets with the highest correlation coefficient betweenactual rental rate growth and what's predicted for the next twoyears are Dallas, Houston, Orlando, Phoenix, Portland and San Jose.Apartment REITs with the highest correlation between actual changesand predicted growth are AvalonBay Communities, BRE Properties,Equity Residential, Essex Property Trust, Summit Properties andUnited Dominion Realty, according to Axiometrics.

Ross says Axiometrics has developed an accurate assessment toolfor those who must decide whether to aggressively hike rents orhold the line. The model's accuracy has been tested by statisticsgleaned from second quarter 1995 through this year's second quarterand is driven by computations of job growth at market level andresidential permitting, explains Ross.