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The apartment vacancy rate for the Portland-metropolitan area ended the first quarter of 2011 at 2.74 percent, continuing the downward trend that started in the fourth quarter of 2009.

According to market research the vacancy rate dropped by about 0.5 percent in the first quarter for the entire Portland market and is down 2.7 percent from its 2009 peak. This also has rental rates rising, with the average two-bedroom, two-bathroom unit up $14 from a quarter previous to $964.

The largest vacancy rate drops in the first quarter of 2011 were in the Southwest Portland and Hillsboro submarkets, both of which dropped 1 percent. Southwest Portland fell to 2.69 percent and Hillsboro fell to 1.99 percent. The lowest vacancy rates at the end of the quarter were in the Lake Oswego/West Linn (1.76 percent), Hillsboro (1.99 percent) and Tigard/Tualatin (2.12 percent) submarkets.

The market research also pointed to two projects currently under construction that will affect the vacancy rate once they are released to the market. These include The Albert, a 70-unit building on North Williams Avenue, as well as the 90-unit project by Phase Two Development at the corner of Northwest 19^th Avenue and Pettygrove Street.