The laws of supply and demand are causing an extreme slump in the apartment market in Gainesville, according to a UF study.
There are large numbers of rental availabilities that would not have existed a few years ago, said Wayne Archer, director of UF's Bergstrom Center for Real Estate Studies.
As the economy declines, people are tightening their pockets, Archer said.
The study incorporates the center's most recent quarterly survey, which reports that less people are buying property.
Apartment occupancy has declined for the first time in the survey's two-year history.
Demand for apartments is reaching a plateau, and people are more anxious about their income, Archer said.
Gainesville Real Estate Management Company has endured pressure from the increasing number of new apartments that are being built, said Keith Crutcher, company president.
"As far as apartments, we have seen a definite softening in the market as a result of about 4,000 new bedrooms that have been built by competition," Crutcher said.
Apartment complexes have been forced to offer incentives, such as a month of free rent and gas cards, in order to get people to rent from them, he said.
The fact that less students are being admitted to UF students is also hurting the market.
"The market changed dramatically in the past 12 months, and we have suffered," Crutcher said.
Archer said rental markets will suffer in the months ahead, but it will pass, and they will recover.
"I don't see much promise of recovery until we're well into 2009," he said. "It'll vary with the location."
