I use to think the same way. I had a first hand experience in such in college. 5% is usually considered healthy. One year, we hit something like .8% vacancy. LL’s were in hog heaven. Rents increased like %10+ a year, people were camping out on streets to try to get a place at any price, it was totally nuts.
Then the crash came. No one ever fully explained it well. Two new complexes that were really big opened up, a smaller one that had been being repaired reopened. The university didnt admit quite as many kids as expected. Everyone bought a house. I dont know, but I do know that when I left the apartment complex right next door was offering 9 month leases and vacancy was something like 10%. You heard that right, a 9 month lease. Since the students didnt stick around in the summer, you could rent a place Sept-June, and then move out, and have it waiting for you when you got back next Sept. Reported monthly rents didnt decrease much, but that is one hell of an incentive.

I dont see this happening in SD. Atleast not until we see some serious out migration. Perhaps the slumping economy will help, but vacancy seems really low right now. That isnt a good thing for rents.