Apartment rents in Southwest County and throughout the western United States climbed modestly last year while home prices crumbled in many markets, a contrast apparently driven by the growing number of people who can't or don't want to buy a house or condominium.

Meanwhile, vacancies are becoming somewhat scarcer as more families lose their homes to foreclosure, according to rental managers and a report that was published Thursday by RealFacts, a Bay Area research firm.

Occupancy rates in Southwest County have crept up by 2 percentage points over the last year, to 91 percent in the October-December period, RealFacts reported.

The average monthly rent in Riverside County rose by 1.3 percent, to $1,150. One-bedroom, one-bath apartments rented for an average of $993 a month, while three-bedroom, two-bath apartments rented for $1,533 on average, according to RealFacts.

Comparably sized apartments in San Diego County rented for an average of $1,202 and $1,824. Average rents in that market rose by 4 percent last year to $1,370 in the fourth quarter.

Record numbers of foreclosures have begun to fill empty apartments in Southwest County, where several new complexes were built in 2005 and 2006. That trend will probably accelerate, said Christian Davis, who oversees more than 1,000 apartment units in southwestern Riverside County and about 200 in northern San Diego County.

Owners who lost their homes after failing to make mortgage payments have already occupied most of the rental houses where individual landlords sometimes scrutinize credit histories less stringently than the corporate owners of apartment complexes, said Davis, vice president of operations for Gables Residential's San Diego region.

"We've literally cut our vacancy rate in half," Davis said.

Davis said the vanishing vacancies could allow owners more leverage by early 2009.

For now, workers' wages and other prices have roughly kept pace with apartment rents over the last year in both Riverside County and San Diego County, based on current data from the U.S. Department of Labor.

But increases in monthly rents were much larger in several urban areas, including a whopping 10.8 percent climb in Silicon Valley, to an average of $1,647.

While the reasons for the higher rents in most areas of California are difficult to pinpoint, a sharp downturn in the number of people buying homes appears to be a contributing factor.

As lenders have become more cautious while wrestling with huge losses from past loans to borrowers with blemished credit problems, fewer people can qualify for the financing to buy the home.

And anecdotal evidence suggests prospective buyers who can still get a mortgage are holding off in hopes that they can get an ever better deal if real estate prices continue to decline as many economists anticipate.

Fewer home buyers typically translates into more people trying to lease their living space -- a supply-and-demand dynamic that works in the favor of apartment landlords.

The abundance of high-paying jobs in high-tech havens such as Silicon Valley and Seattle also is propelling rents upward as more people move into those markets to work.

The West's least expensive apartment rental market remained Tucson, Ariz., where the monthly cost edged up 2.9 percent to $665.

Davis said Gables and other apartment companies across the region are changing the way they evaluate applicants from foreclosure situations.

A foreclosure had been a very heavy black mark, but Davis said many apartment managers understand that runaway mortgage payments got the better of many people with otherwise solid credit. The challenge is to distinguish such renters from those who had borrowed on their homes irresponsibly, he said.

"It's forcing us and our competitors to go back to our procedures and say 'how do you adjust this?" he said. "We're in the business of giving people homes, but we're not in the business of doing it for free."

The Associated press contributed to this report. Contact staff writer Chris Bagley at (951) 676-4315, Ext. 5444 or cbagley@californian.com.