With a scant 2.1 percent vacancy rate, New Haven, Conn. had the tightest rental market in the country during the third quarter, according to New York-based commercial real research firm Reis.

With a scant 2.1 percent vacancy rate, New Haven, Conn. had the tightest rental market in the country during the third quarter, according to New York-based commercial real research firm Reis.

Other secondary areas, such as Greenville, Greensboro/Winston-Salem, Dayton, Omaha, and Tulsa, also boasted large vacancy declines in the third quarter. Reis notes that these smaller markets hadn’t been leaders in vacancy compression in the second quarter.

“Many of the markets that had formerly been the leaders of the apartment market recovery, especially the technology- and energy-oriented markets, are now experiencing rising vacancy rates as new construction in these dynamic markets races ahead of demand,” Reis says in the report.

Overall, only 13 markets have vacancy lower than 3 percent. There were 16 markets below that threshold in the second quarter.

“While one could argue that it is a good thing to see some other markets now leading the charge, these markets tend to be smaller, and with the larger markets' vacancy rates increasing, national vacancy is drifting higher,” Reis said in the report.

Only 35 markets had a decline in vacancy in the third quarter; 45 markets saw declines in the quarter before. But things were better for owners in terms of rent metrics: For the second consecutive quarter, all 79 of the markets surveyed by Reis had an increase in effective rents. And, that pattern should hold for a while.

“Rents are projected to continue to grow in all of our primary markets, indicating that it will largely remain a landlord's market despite the supply growth,” Reis said in the report.

The 10 Tightest Markets of the Third Quarter: 1. New Haven, Conn. 2.1%
2. Sacramento, Calif. 2.4%
3. San Jose, Calif. 2.5%
4. Orange County, Calif. 2.5%
5. San Diego, Calif. 2.5%
6. Hartford, Conn. 2.5%
7. Oakland-East Bay, Calif. 2.6%
8. Omaha, Neb. 2.6%
9. Cleveland 2.7%
10. New York 2.7%