March 31 (Reuters) - The U.S. office vacancy rate fell to 16.6 percent in the first quarter from 16.7 in the fourth, the lowest since the third quarter of 2009, research firm Reis Inc said.
"The labor market has gotten off to a solid start in January and February and it continues to strengthen... We continue to expect that the national vacancy rate will fall by roughly 50 basis points in 2015...," Ryan Severino, the firm's senior economist, said in a statement on Tuesday.
Washington D.C. remained the tightest market, with a vacancy rate of 9.3 percent. New York followed at 9.6 percent.
Houston's vacancy rate increased by 0.6 percent to 15.1 percent, its highest level since the third quarter of 2011, as the market clearly felt the impact of the decline in oil prices.
Overall net absorption was 6.4 million square feet of office space in the quarter, Reis said.
Construction of office space declined to about 4.547 million square feet in the quarter, the lowest in two years, Severino said.
The asking and effective rents increased by 0.9 and 1.0 percent, respectively, in the latest quarter.
(Reporting by Ankit Ajmera in Bengaluru)