BEWARE: FALLING VACANCIES
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|Niagara Falls ain't got nothin? on the recent drop in Dallas apartment sector vacancies, says waterfall enthusiast (and Reis analyst) Brad Doremus. The pace has been quick over the past few quarters, even relative to steep declines nationally. Between Q3 and Q4 2010,vacancies fell 100 bps from 9.1% to 8.1%, fast on the coattails of a 90 bps drop from Q2 to Q3. The only comparable period since Reis began tracking quarterly data in 1999 would be the 190 bps decline posted in Q3 and Q4 of 2005, smack in the midst of the most recent period of economic expansion. Year-over-year, vacancies are down 260 bps from 10.7%, which also represented the metro?s cyclical peak. While further declines are to be expected in the coming years, do not expect to be wowed. Over the next several years, the vacancy rate should decline by about 100 bps, barely a ripple compared to the waves seen in recent quarters.|