Renters in San Jose beware: The San Jose metropolitan area apartment market is the tightest in the United States, according to a recent report by Marcus & Millichap Research Services    Marcus & Millichap Research Services Latest from The Business Journals San Jose apartment market is tightest in nationSan Antonio’s medical real estate market slow but steady, study shows Industrial sites showing signs of life Follow this company .

San Jose had a 3.1 percent vacancy with an average asking rent of $1,506 per month for the third quarter, the report said. By contrast, U.S. metros as a whole had a 5.6 percent vacancy with an average asking rent of $1,048 per month during the same period.

Marcus & Millichap predicts overall asking rents in San Jose will climb 5.4 percent to $1,525 a month by year's end compared with 2010, and to $1,615 in 2012.

In the South Bay alone, the report notes that there are 1,216 rental units under construction, with the largest project slated for delivery this year being the 374-unit Fairfield Cerano apartments in Milpitas.

About 290 units are expected to break ground in the Mountain View/Los Altos markets in the next nine months, accounting for the most planned projects that are slated to kick off in the next nine months in the region.

"Leasing activity continues to swell in step with rising employment, but more specifically from the immigration of newly employed tech workers, which has steadily bolstered net absorption over the past two years," the report said.

In Mountain View and Cupertino, class A apartment rents have climbed more than 5 percent so far this year.

Looking ahead, the report predicts the South Bay apartment market will only strengthen in the short term due to "outsized" home prices and renewed job creation.

Marcus & Millichap defines the San Jose metropolitan area as including Campbell, Los Gatos, Sunnyvale, San Jose, Cupertino, Saratoga, Mountain View, Los Altos and Santa Clara.

Realtor.com operator Move.com just added 35,000 rentals to Realtor.com's 4.3 million homes for sale, and why not?

The rental market is booming and renters ultimately become buyers.

According to demographics compiled by the Joint Center for Housing Studies of Harvard University, 78 percent of under-25 households are renters, but by the age of 40, 66 percent of households are owner-occupied.

But anyone shopping for housing these days needs to take a closer look at what it costs to rent vs. buy and the new service zeros in on that.

Realtor.com has long offered single-family homes for rent, currently lists about 150,000 of those units, and will now add Move.com's 6,000 apartment communities to the mix.

"It's an opportunity to connect millions of people interested in the convenience apartment communities offer, while providing tools like the 'rent vs. buy' calculator, local homes for sale and connections to real estate professionals," says Eric Gramberg, vice president of Move.com, which operates Realtor.com.

It's also an eye-opener.

Results from browsing for rental housing on Realtor.com include homes for sale in the same area to show rental housing hunters the difference between a monthly mortgage and a rental payment.

It's a necessary comparison home today's home shoppers must consider. The booming rental market is certainly behind Move.com's move, but it's also behind the rising cost of rents.

In October CoreLogic’s "U.S. Housing and Mortgage Trends Report" revealed the share of income that goes toward housing is growing faster among renters compared to homeowners.

Since 1985, homeowners have increased their housing expenditure allocation by 12 percent, while renters increased by 22 percent. As of 2010, homeowners spent 33.2 percent of their expenditures on housing, up from 31.9 percent in 2005. Renters spent 38.4 percent of their expenditures on housing, up from 35.6 percent in 2005, CoreLogic reported.

RealFacts.com recently reported the residential rental market is one of the few economic sectors firing on all cylinders in a full-recovery mode.

In the third quarter of 2011, the national average rent was $994 a month compared to the peak market rent of $997 a month in the third quarter of 2008, according to RealFacts, an apartment industry research and analysis firm.

The occupancy rate, at 93.4 percent for the third quarter this year, is as high as it’s ever been. The rate was 92.6 during the last peak of the market, the third quarter 2008.

It's all pushing up rents, often beyond the cost of a monthly mortgage payment.

With the housing market is still fraught with tight credit, free-falling home prices and an oversupply of distressed properties clogging the pipeline, the rental housing sector has nowhere to go but up.

However, even with some rents higher than a mortgage payment, many consumers who can't yet qualify to buy, see renting as a viable option for shelter until it's time to take the plunge. To them, higher rent is a less risky proposition than it is to buy a home and see values fall.

"Powerful demographic trends along with changing attitudes about home ownership and tighter mortgage underwriting continue to drive a shift toward renting," said National Multi Housing Council (NMHC) Chief Economist Mark Obrinsky.

According to Dave Masters, Move.com's manager of sales training and effectiveness, the deal comes with no additional cost to current customers who list on Move.com's apartment listing site.

Masters says the move by Move.com is a win-win for all because:

• Nearly 14 million unique visitors performed searches on Realtor.com in September, generating over a half a billion page views.

• Given 10 percent of those browsing for housing are looking for rentals. That's 1.4 million users looking for rentals.

• Also, 23 percent of all email leads generated on Realtor.com are for rental properties.

"We expect to see even greater consumer interaction with the addition of this high quality, comprehensive content on the site," writes Masters.