Apartment Report: Vacancy to Stabilize in '04

SACRAMENTO, CA-Apartment vacancy here is expected to stabilize in 2004 as employment gains accelerate in the local market, according to the latest report from Marcus & Millichap Real Estate Investment Brokerage Company.

Sacramento employment is forecast to remain flat through the end of the year but then grow in 2004, with more than 14,000 new positions expected, according to the report, which would be a 1.9% jump in overall employment. In light of that, Marcus & Millichap is predicting that apartment vacancy will continue a slow rise through 2003, topping out at 6.9% before stabilizing in 2004 on the strength of the employment gains.

As of the end of the third quarter, apartment vacancy in the metro area stood at 6.7%, up 220 basis points from the third quarter of 2002. The tightest submarkets in the region include Elk Grove/Laguna and South Sacramento. As of the third quarter, Roseville/Rocklin and Folsom registered the highest levels of vacancy, at 10.9% and 10.2%, respectively.