The vacancy rates for South Florida apartments remain much lower than the national average, but there are signs monthly rent increases are starting to ease, according to a report released Wednesday.

Vacancies in Miami-Dade and Broward counties were both at 3.8 percent for the first quarter that ended March 31, according to numbers released Wednesday by Reis, a national commercial real estate watcher. That compares to 6 percent nationally, the highest in almost two years.

Average rental rates in the first quarter still rose to $1,058 in Miami-Dade, up 1.6 percent from the previous quarter and 5.9 percent from the same time last year. For Broward the average was $1,051, up 0.6 percent from the pervious quarter and 5.2 percent from last year. However, the pace of the increases is slowing.

In recent years, rents have risen in South Florida and vacancy rates have shrunk, along with the supply of apartments. That’s because many apartments were converted to condos, and new construction also focused on condos rather than rentals.

But as the condo market slows down, some converted or newly built condos bought by investors are likely to go back on the market as rentals. Condo conversions have already slowed significantly, and some proposed conversions have reverted to become rentals again.

Reis Chief Economist Sam Chandan said it appears the two trends are slowing rent growth in the region, which is good news for renters.

”Look at Fort Lauderdale,” he said. “We’ve gone from [quarter-to-quarter] rent growth of 2.8 percent in first quarter last year to 0.6 percent this year.”

The Broward number was less than the national average of 1 percent.

Miami-Dade saw higher rent increases, though it too showed signs of slowing. Miami-Dade rents increased 2.1 percent in the first quarter last year but improved 1.6 percent this year.

Still, Chandan was quick to add that the South Florida rental market remains strong for landlords — many of whom have grappled with rising insurance costs and property taxes — due to low vacancy rates and still-rising rents.

Miami-Dade’s rent growth was better than the national average.

Across the country, Memphis, Tenn. had the highest vacancy rate at 11 percent, followed by Colorado Springs and Tulsa, Okla., according to the study. The New York metropolitan area had a vacancy rate of 2.4 percent in the first quarter, the lowest in the survey. Connecticut’s Fairfield County had the second-lowest rate and Los Angeles was third.

Nationally — and in South Florida — the pool of renters could increase as subprime mortgage lenders fail, making it more difficult for people with weak credit scores to get financing to buy. New Century Financial Corp., once the second-largest U.S. subprime lender, filed for bankruptcy this week.

Scheduled increases in adjustable rate mortgages will also cause cash-strapped owners to lose their homes, the study said.

Information from: www.miamiherald.com

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