Real Estate (Residential). (Barely Making the Grade).

Year in Review: L.A.'s notoriously tight market helped both single-family and multifamily housing buck the broader economic slowdown. Property values and rental rates showed steady appreciation.

Apartment rents were up 8 percent countywide over last year. Low supply/high demand for apartments in mid-range San Fernando Valley communities (Canoga Park, Reseda) and South Bay (Lakewood, Hawthorne) keeps vacancies low, rents increasing. Tech wreck an market downturn hits luxury spots like Wilshire Corridor the hardest.

Sales prices of single family homes were about 13 percent countywide, with sales volume up 6 percent... Hot areas included 210 corridor (Monrovia, Azusa and Glendora showed 15 to 20 percent annual appreciation) and Westside fringe areas like Culver City and Westchester.

Players to Watch: Big multi-unit investor/developers... Market has seen significant commitment from Apartment Investment and Management Co., which bought Beverly Hills-based Casden Properties for $1.5 billion in a year-end deal... Lincoln Property Co. and Trammell Crow Residential target Marina del Rey, starting work on large residential complexes to be completed in 2003... Washington Mutual, which is in an unfamiliar business wit its planned development of the 3,050-home Abmanson Ranch near Calabasas. Environmental opposition to the project is strong.

Buzz for 2002: Interest rates may inch upward, but will remain at relatively low levels, spurring further sales. Broader economic slow down will have an impact at the higher end... Single-family home appreciation will slow as homeowners slowly come to realize they can't get the record-high prices of early 2001.

Small-scale apartment rehabbing and updating in gentrifying communities like Eagle Rock, Silver Lake and East Hollywood will continue... Marina-area supply will catch up with demand as condos (Regatta, Marina Pointe) and apartment projects (Playa Vista's first 700 units) come on-line by mid-year. Result will be a plateau in sales prices and rents.

Mid-range single family housing market ($300,000 to $500,000) will continue to be driven by low interest rates and increasing rents... With Alan Casden sitting on a pile of cash, a purchase and development of. a Westside-fringe area multiunit complex can't be too far in the future... Luxury complex owners like Legacy Partners will keep making concessions (free rent, upgrades) to pull higher-end tenants.

Downtown loft-conversions will remain strong, with demand slowing once the 10,000 plus units in development come on line at the end of the year... Expect quick lease-up of J.H. Synder's mixed-use NoHo Commons project, which includes 810 loft and apartment units. The project, which breaks ground at the end of the year, will be delivered to a North Hollywood market with a vacancy rate under 1. percent.

Grade: A-