The apartment vacancy rate in the city of Davis declined to 0.7 percent this fall, and rental rates rose by an average of 4.18 percent, according to a survey by the University of California, Davis.

The annual vacancy and rental-rate survey, now in its 32nd year, is conducted by the Student Housing department at UC Davis. It is intended to provide the campus and the city of Davis with information for future planning.

This fall's vacancy rate is the lowest since 2002, when it was 0.2 percent. Last year, the apartment vacancy rate was 1.8 percent, and the average rental-rate increase was 2.6 percent.

Economists and urban planners consider a vacancy rate of 5 percent to be the ideal balance between the interests of landlord and tenant.

"I think what we're seeing are the effects of the large freshman class in 2006 moving out into the community for its sophomore year when apartment building has not kept pace with demand," said Emily Galindo, interim director of Student Housing. "The market will probably be a little tight as that class moves toward graduation or until more units are built."

Last year, when almost 900 more freshman applicants than expected accepted offers of admission for fall 2006, UC Davis honored its commitment to them and enrolled a record entering class of 5,511. This fall, 4,955 new freshmen entered directly from high school.

Total enrollment for fall 2007 is a record-setting 30,685, up almost 0.7 percent from last year's 30,475. Enrollment on the Davis campus itself is expected to average 26,830 over the three quarters of the current academic year.

As of an Oct. 25 projection, enrollment is estimated to be about 30,940 for fall 2008 and expected to average 27,100 on the Davis campus over the three quarters of the 2008-09 academic year.

According to the UC Davis survey, the average monthly rent this year for unfurnished two-bedroom apartments -- which are the most abundant type of apartment unit and account for almost 46 percent of the units in the survey -- rose 5.4 percent, from $1,112 to $1,172.

UC Davis Student Housing surveyed 187 apartment complexes with five or more rental units in October and November; 172 complexes responded. Out of a total of 8,634 units reported, 63 were vacant. The 15 complexes that did not respond to the survey have a total of approximately 194 units.

The broader region

RealFacts, a Novato, Calif.-based research and consulting service for multifamily apartment communities, reports an average vacancy rate of 2.3 percent and year-over-year rental-rate increase of 3.6 percent for Davis in the third-quarter of the year. In Davis, it surveys apartment complexes with 50 or more units.

Over the same period, the company reports the average vacancy rate and average year-over-year rental changes for the following cities in the region:

• Woodland: 3.1 percent vacancy rate and 0.6 percent rent increase
• West Sacramento: 17.7 percent vacancy rate and 0.4 percent rent decrease

Rental rates

Among 12 types of rental units included in the survey, the highest average monthly rent increase was 5.96 percent for 213 unfurnished studio apartments (from $705 to $747).

Average rent decreased for only the 86 furnished two-bedroom apartments, from $1,045 to $1,039, or almost 0.6 percent.

The overall average increase in the rental rate is calculated by considering the percentage change for each type of rental unit and the proportion of each type of rental unit among the entire rental inventory.

The survey excludes those apartments that require an income eligibility test to qualify low-income residents for reduced rent, because students typically are not eligible for these units.

Campus housing

UC Davis has about 4,535 students living in residence halls, and an additional 1,820 students live in privately managed housing on campus, such as Russell Park for student families.

The university is proceeding with plans to build 343 single-family homes and town homes for faculty and staff, and apartment housing for up to 1,980 students in phase one of its West Village development.

Groundbreaking for the site, which is west of Highway 113 between Hutchison Drive and Russell Boulevard, is planned for 2008, and the first occupancy could be in late 2009.

When completed, West Village will comprise two phases totaling 500 housing units for faculty and staff, and student housing for 3,000.

Meanwhile, the second phase of Tercero South, now in the design stage, is expected to add 600 beds in three buildings adjacent to the Tercero South complex at Dairy and La Rue roads. Pending project approval by the UC Board of Regents, the campus anticipates occupancy for fall 2010.

Help for the housing search

To help students in their search for housing for the next academic year, Student Housing offers workshops in the residence halls beginning in late January. The sessions offer information on the local rental scene, provide search tips and address topics from budgeting to leases.

The Associated Students of UC Davis usually hosts an annual Housing Day in mid-February. Students have the opportunity to meet with representatives from local apartment complexes and to gather other information and tips for renting apartments.

To receive a copy of the survey, please e-mail Julia Ann Easley at jaeasley@ucdavis.edu.