The Census Department will release data on vacancy rates later this week, which will give us more information on the overall state of supply and demand in the housing market. The recent movement in rents provides no reason for believing that there is any underlying tightening of the market. Owners' equivalent rent is rising at just over a 1.0 percent annual rate. (This series differs from some realtors’ series showing rising rents, because it measures changes in rent for the same units over time. It does not compare the rent of different units.) This is up compared with the declining rents of 2010, but there is no clear upward momentum. It is likely that oversupply will exert further downward pressure on prices.

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For more, check out the latest Housing Market Monitor.

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