Marcus & Millichap says renters are already behind the eight ball in hot areas -- Orange County, San Diego, Los Angeles and Riverside-San Bernardino, CA markets, as well as Fort Lauderdale, FL.

Landlords in Las Vegas, NV; Washington, D.C.; Boston, MA and more California cities, Oakland and San Francisco are already benefiting from low levels of new rental housing and the expected employment gains, according to Marcus & Millichap.

That jibes with news from Novato, CA-based RealFacts, which reports on the Western U.S. market and recently revealed occupancy levels just at or above 95 percent in Los Angeles, Oakland, Orange, San Diego, San Francisco as well as California's Inland Empire and Las Vegas, NV.

"As property managers struggle to increase occupancy and maintain asking rents, lessees are offered an array of concessions such as lease-signing bonuses; free weeks and months rent; and added amenities such as washers, dryers and free parking. In the hardest hit rental markets -- such as those of Texas and northern California -- many property managers offer potential tenants both reductions in asking rents as well as significant concessions that lower effective rents. In the Dallas/Ft. Worth market, for example, while asking rents declined 3.5 percent over the year, concessions reduced effective rents in some apartment complexes by as much as 20 percent," according to RealFacts.

Marcus & Millichap said renters could maintain their negotiating edge in Atlanta, GA; Denver, CO and Texas towns, Dallas and Houston, but the report warns high vacancy rates could be a transient condition if the market of renters out paces the supply.

Not faring as well as its neighbors to the north, the San Jose, CA metropolitan area (Silicon Valley's Capital) still suffers relatively high rents, but persistent vacancies from the dot com demise has kept landlords hopping with concessions and hoping for more renters. Change there isn't expected until 2005.

Uncertainty was found in the mixed markets of Jacksonville and Orlando FL; New York; N.Y.; Portland, OR and Seattle, WA, according to Marcus & Millichap.

"Although occupancy rates slipped in many markets during the fourth quarter, in most markets rents were relatively stable. Rent declines, where they occurred, were modest. Even in San Jose, the only market to experience a fourth quarter decline in rents of more than one percent, the rate of decline was significantly less than that of a year ago. While rents have yet to rebound in most markets, the worst seems to have passed. Still, occupancy levels will need to improve in most markets for there to be the constricted supply and excess demand conditions necessary for sustainable rent growth," RealFacts reported on the Western U.S. market.