Yes, the rental market is red hot right now in many areas of the country. This can be attributed mostly to the high rate of unemployment. Lending guidelines have really tightened up which removes some would be buyers from purchasing as well.
But...I can tell you that in my area single-family home sales at the entry level have improved. First time home buyers who are eligible are taking advantage of low prices, historically low interest rates, and plenty of inventory.
Prudential Connecticut Realty