The average vacancy rate at Phoenix-area apartment communities declined in the third quarter after a slight increase in vacancy during the previous quarter, according to real-estate services firm Colliers International in Phoenix.
The vacancy rate dipped below 9 percent for the first time in years, causing rent prices to inch higher, according to the firm's analysis.
The improvement in market fundamentals spurred continued investment in apartment properties, with several large projects changing hands.
The 240-unit Level at Sixteenth, 1550 E. Campbell Ave., Phoenix, sold for $40 million, about $166,667 per unit.
The 324-unit Ironhorse at Tramonto, 34807 N. 32nd Drive, Phoenix, sold for $30.5 million, or $94,136 per unit.
The 224-unit Fountain Oaks, 1225 N. 40th St., Phoenix, sold for $8.3 million, or $37,054 per unit.
The 120-unit Dobson Springs, 1325 W. Guadalupe Road, Mesa, sold for $5.4 million, or $45,000 per unit.
The 101-unit Dobson Bay Club Apartments, 1331 W. Baseline Road, in Mesa, sold for $4.6 million, or $45,545 per unit.
It was the sixth time during the past seven quarters in which vacancy decreased in Phoenix-area apartments, Colliers analysts said.
The vacancy rate reached 8.8 percent as of the third quarter and is expected to reach as low as 8.4 percent by the end of the year.
That's a significant drop from the average vacancy rate of 10.9 percent in the third quarter of 2010.
Lease rates at local apartment communities have remained relatively flat but are expected to increase in 2012, the analysts said.
During the third quarter, the average advertised rent price reached $779 per month, up slightly from both the second quarter of 2011 and one year earlier.
While apartment vacancies should continue to decline, the firm said, landlords likely will see further competition as more investor-owned single-family homes are placed on the market as rentals.
by J. Craig Anderson Arizona Republic Nov 4, 2011
Apartment vacancy rate dips below 9% for 1st time in years
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