It seems to me it can be a bubble if new construction pumps up supply way beyond demand. In most areas new construction just doesn't pencil out. Unlike other real estate slumps, commodities costs are very high. This could change but for the short to mid term time frames it looks like supply will be limited.
I predict another bubble that will include the residential rental market. One occurs every decade. This coming one may be a bit harder to survive. It all depends upon your financial position in the property and market. If you are able to out compete your competitors is a huge factor. If your property is more desirable is another huge factor.
Good point Gene, it's like that here yet I don't think apartment construction ever stoped! Custom builds are up.
Tom, I agree with you, it's keeping an advantage.
Beware! Local polotics in banking, all that have rentals leveraged with balloons, they may not be renewing at smaller and mid-size lenders. Your income will be critical to re-qualify. You lose the place and someone else will be taking your place. Heard the talk at the club, some investors know when properties will be hitting the block, or, where a deal is made when the banker is suggesting they sell, wink and a nod. Keep yourself in good shape as well. :)