The National Association of Realtors (NAR) is forecasting that the vacancy rate on multifamily dwellings will fall to 4.2% this quarter compared to 5.6% a year ago as high demand outstrips supply.

Moreover, rents will likely increase by 4.1% this year compared to 2.2% in 2011, the trade group predicted. “Sharply higher demand for apartments is causing rents to rise at faster rates,” NAR chief economist Lawrence Yun said.

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