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The housing market remains a potent drag on the economy as home prices continue to slip, foreclosed homes fill some neighborhoods and millions of construction workers scramble for jobs.

But one group is sitting pretty: landlords.

Unlike home prices, rents have been rising, up 2.4 percent in January from a year earlier, according to recent data, not adjusted for inflation, released by the Labor Department.

With few rental buildings erected over the past few years, available units are going fast. Nationwide, the apartment vacancy rate is down to 5.2 percent, its lowest level in more than a decade, according to the research firm Reis Inc.

Rent increases are greatest in places like San Francisco; Austin, Texas; and Boston, where technology companies in particular are hiring, as well as in New York City and Washington, D.C. But cities like Chicago and Seattle, where house prices are still declining quite sharply, have had rental increases, too.

"We are more of a renter nation than we have been for a while," said Christopher Mayer, a professor of real estate at the Columbia University Business School.

Economists suggest favorable conditions for landlords will continue for at least a year, with employment gradually rising and apartment construction remaining constrained.

The home ownership rate has been falling from its peak of 69.4 percent in 2004, according to census data. By the fourth quarter of 2011, it was down to 66 percent. That means about 2 million more households are renting, said Kenneth Rosen, an economist and professor of real estate at the Haas School of Business at UC Berkeley.

Investors could help the market by turning empty houses into rentals, said Diane Swonk, an economist at Mesirow Financial in Chicago.

"It can make the difference between a neighborhood being literally like Detroit -- dead forever -- or a neighborhood that has another chance at life," she said.

Still, it is apartments, not houses, that are in the most rental demand.

The limited supply is pushing up prices in some markets. In San Francisco, rents jumped close to 5 percent last year, according to Reis, and increases averaged 3 percent in Austin and New York. Landlords have also been withdrawing incentives like a free month's rent.

Liz Brent and Matt Mochizuki moved into a studio apartment a year ago in the Mission District in San Francisco for $1,395 a month. Now they want more space.

Brent, 26, makes costumes and is working as a barista at a cafe where customers leave big tips. Mochizuki, 27, has a steady job with a metal fabricating studio. They are budgeting $1,800 a month in rent.

But at an open house for an apartment billed as a one bedroom, they found a studio with an awkward layout and bad light. More than 40 people were in line, many ready to hand over a check.

"That's what the market is like now," Brent said of her fruitless search. "That's how many people showed up for this tiny apartment with no windows."

A few metropolitan areas are experiencing a much softer rental market. In Atlanta, owners of vacant condos are lowering rents to attract tenants, and in Las Vegas, homes are taking six weeks to lease and rents are still well below their peaks, said C. Terry Robertson, broker of Desert Realty.

Orlando might seem an unlikely place for rental strength. The unemployment rate, at 9.7 percent, is higher than the national average, and home prices slipped 4.6 percent last year, according to the Standard & Poor's Case-Shiller home price index.

Yet Ric Campo, chief executive of Camden Properties, a real estate investment trust that owns apartment buildings, said rental business was brisk at its LaVina development. Since the office for the 420-unit complex opened last summer, more than half the apartments have rented.

That's "a faster rate than we've ever seen in Orlando," Campo said. The company has raised the base rent on a two-bedroom apartment to $1,080, from $995 a month.

Many are left to wonder whether the housing collapse has had a more profound effect.

"I think it's going to be interesting to see whether there's been a fundamental sociological shift in that 20-35 year old cohort, where they literally say 'this American dream just doesn't work for me,"' said Brad Forrester, chief executive of the ConAm Group, which manages about 50,000 apartments in the western United States.

Matt Byford, a 24-year-old litigation consultant in Chicago, is certainly in no hurry to buy. He has been renting in the Lincoln Park neighborhood since his college days.

Given the low purchase prices and record low interest rates, Byford acknowledges that the financial scale probably tips more toward buying than renting. "Since I can pretty much assume with confidence that it's not going to go anywhere," he said, "I don't necessarily have a sense of urgency."