Demand for apartments in Orange County came in at about 2,200 units during the initial three months of 2010. Early 2010 actually marked the metro's third consecutive quarter of substantial apartment absorption, taking demand for the year-ending March to a decade high of nearly 6,800 units.

With demand well surpassing completions during recent months, occupancy in Orange County's apartment base has recovered by nearly 2 full percentage points from the bottom reading seen in the middle of 2009. However, at 94.4 percent, March 2010 occupancy still was roughly 2 points under the metro's long-term historical norm.

The bump in occupancy seen during early 2010 was enough to get rents basically stabilized. In MPF Research's same-store sample, effective rents as of March exactly matched the rates seen three months earlier. Effective pricing still was down on an annual basis, off by 3.8 percent, but that loss sure looked a lot better than the annual decline that earlier had gotten as deep as about 8 percent.

While Orange County's apartment performance prospects now appear pretty encouraging in the big picture, the leasing environment for top-tier product certainly should be competitive over the next few months. Influencing that outlook, properties totaling some 2,500 units have scheduled completion dates during 2010's 2nd and 3rd quarters.

A portion of the data used in this post is acquired through property management software, which provides property owners and managers the ability to report baseline statistics to county recorder's offices, news publications, and other reporting agencies. Improvements to property management systems will allow us to more efficiently track occupancy and rent/price fluctuations at city and county levels.

Market Dynamics is an examination of key influences on the apartment industry by MPF Research, the industry's most trusted source of apartment market intelligence. To receive the latest Market Dynamics newsletter in your e-mail inbox, please click here to subscribe.