The rental market in Northern Virginia is headed back toward the days when prospective tenants lined up for hours to rent an apartment, according to a report scheduled to be released next week.

In contrast, the market in suburban Maryland in the coming months should be much more favorable for renters than in Northern Virginia, according to the report.

On balance, the quarterly report by Alexandria research firm Delta Associates shows market conditions for landlords have continued to improve in the Washington area market.

In the third quarter of this year, vacancies tightened, rent increases accelerated, the pace of apartment absorption quickened, concessions declined and conversions of rental apartments to for-sale condominiums continued to curb the number of available rentals, according to the report.

Rent growth in the area over the past year was 4.3 percent, the steepest rate of increase since 2000, the report said. The vacancy rate for the region in the third quarter was 2.1 percent, the lowest in the nation and down from 2.3 percent in the second quarter.

"The rental market has come back from its soft patch of 2001-2002 much faster than we expected," said Gregory H. Leisch, chief executive of Delta Associates. "We thought it would be back by 2005-2006. But it's back already."

About Northern Virginia, he said, "Soon we think we'll see the kind of vacancy rate that we saw in 2000, when people couldn't find apartments."

Jim Rosenberg, president of Charles E. Smith Residential, the largest apartment company in the Washington area, said rent increases in the company's 22,000 local units have generally ranged from 3 percent to more than 6 percent in the past year.

"It's all about job growth," said Rosenberg. More than 80,000 new jobs were created in the Washington area in the 12 months that ended in July, according to the Bureau of Labor Statistics. More new jobs were created in the Washington region than any other U.S. metropolitan area. Many of those new jobs were related to government spending.

"It's federal contracting and the expansion of the federal government," Leisch said.

Julie Smith, president of Bozzuto Management Co., said rent increases in the company's 12,000 units in the Washington-Baltimore region have generally ranged from 3 percent to 5 percent over the past year.

Although the entire region has benefited from federal government spending, there are differences in the outlook for the rental market in Northern Virginia, suburban Maryland and the District, according to the Delta report. A shortage of apartments is developing in Northern Virginia, which is bad news for tenants and good news for landlords.

Although developers will break ground on 5,000 new apartment units in Northern Virginia by the end of the year, a record number for a single quarter, that still won't satisfy demand, Delta predicts.

Leisch said there were several reasons why the Northern Virginia market now looks rosier for landlords than does suburban Maryland: After the implosion of the Northern Virginia technology sector in 2000, apartment developers turned to suburban Maryland and the District. The deals made then are now resulting in finished buildings.

Additionally, Maryland hasn't had the same level of job growth as Northern Virginia. And fewer rental units converted to for-sale condominiums in Maryland than in Virginia.

"Northern Virginia's supply has been worked down dramatically by better-than-expected absorption and condo switches and conversions," the report said. "As a result, we expect there to be a shortage of pipeline product in 2006. The market is already anticipating this with strong rent increases; concessions burning off rapidly; and overall vacancy rates at 5 percent or below."

The report added, "In contrast, in suburban Maryland, the growth in the pipeline has been stunning."

Smith from Bozzuto agreed. "There's just so much more rental product in suburban Maryland than there is Northern Virginia," she said.

In the District, supply has been kept down by strong absorption levels -- about 1,000 units a year -- condo switches and delays in projects starting, Delta said.

"Northern Virginia is just booming," said Rosenberg from Charles E. Smith, a division of Colorado-based Archstone-Smith. Most of the company's units in the area, about 16,500, are in Northern Virginia.

"Maryland just isn't as deep or as strong of a market," Rosenberg said. One reason is that home purchase prices have been lower in Maryland and so renters could more easily afford to buy rather than rent, he said.

Bozzuto's Smith said that low interest rates, which have allowed many renters to become homeowners, will continue to be a "challenge" for landlords, but that "at the same time, we'll benefit from all the projected job growth in the region."