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DALLAS-The Dallas/Fort Worth apartment market is picking up, according to a third-quarter report by Hendricks & Partners obtained by GlobeSt.com. The overall vacancy rate had dropped to 7.8% from 9.9% a year earlier, and the average monthly rent for all units has risen modestly to $685 from $680.Several factors are helping the apartment market, the report notes. One of them is Katrina, “with its well-known ripple effect throughout the Gulf region (that) has created a sudden influx of both temporary and potential payments,” according to the report.”That effect, coupled with healthy economic growth, is spurring housing demand,” the report adds. “The housing of Hurricane Katrina evacuees and a strong economy, both played a significant factor,” in the absorption of 5,960 units in the third quarter. However, many evacuees are renting older apartment units, which tend to have below average rents, the report notes, which is why the average monthly rent only grew by a “subdued” 0.6%.Hendricks & Partners sites a study by Deloitte & Touche, which notes Texas tied for second in the nation in the number of high-growth technology companies within the state. About half of those are in the Dallas Metroplex region. Also, foreign companies such as LG Electronics are expanding in the area, with plans to invest $24 million and hire 700 workers, all which bodes well for multi-family housing.The area has been plagued in recent years by over-building. However, higher land prices are putting the brakes on multifamily construction, the report notes. “As a result, inventory growth is the lowest it has been in several years,” according to the report. “This has prompted at least one firm to cancel an in-progress condo conversion project and keep it as a rental property.”The report shows that the lowest vacancy rates are found in the Plano/McKinney/Allen submarkets, where the average vacancy rate fell to 5% from 7.1%. The highest vacancy rate is in the North Dallas/Highlands submarket at 11.7%. A year earlier, however, the vacancy rate in that submarket stood at 14.8%.

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