Rent growth has been steadily increasing over the last few years, but it looks like the industry peaked in 2012, according to an analysis by New York-based market researcher Reis.

While fundamentals like vacancy rates and supply absorption are healthy, the slow pace of job formation has hamstrung owners' ability to raise rents. Asking and effective rents both rose by 1 percent in the third quarter, but that growth is still below the quarterly average from last year. In previous cycles, rent growth would be well above 4 percent given the vacancy rates the industry is now seeing, the report says.

National vacancies are continuing to fall, and declined 10 basis points in the third quarter to 4.2 percent. In the last four quarters, national vacancies declined by 50 basis points. The demand for apartments remain strong, as the sector absorbed 41,283 units in the third quarter, higher than that from the same period a year ago, and up 22.7 percent from the last quarter.

More than 36,000 units came online in the third quarter, nearly 10,000 more than last quarter’s. It’s also the highest level of quarterly completions since the fourth quarter of 2009.

Some of the lowest vacancy rates in the nation were reported in New Haven, Conn. and Syracuse, NY, at 2 percent and 2.1 percent, respectively. These markets were inundated with the return of students to campus during the third quarter. There are 11 major markets with vacancy rates below 3 percent, predominantly along the east coast and in California, where housing is expensive and new supply growth is strained.

Given all the growth in new supply, vacancies are expected to rise modestly next year. Rents are also expected to rise next year, but "2012 appears to be our peak year for rent growth during this cycle," wrote Victor Calanog, Reis' vice president of research & economics.

He notes that some large investors are now considering exit strategies, such as the Carlyle Group, which signaled its intent to sell part of its $2.3 billion apartment portfolio in a recent conference call amid fears of growing supply.

-Linsey Isaacs is an assistant editor with Multifamily Executive magazine. Follow her on twitter @LinseyI  to continue this conversation.