2026 Multifamily Outlook: What the Data Says Right Now

After the most ambitious supply wave in four decades, multifamily fundamentals are stabilizing—and in some markets, improving. Freddie Mac projects national rent growth around ~2.2% in 2026 with vacancy near ~6.2%, a reflection of strong demand offset by still-elevated new deliveries. Origination volume is expected to rebound to $370–$380B as rates stabilize—albeit higher than the last cycle’s lows.

Fannie Mae’s January view adds nuance: markets with heavy new supply (e.g., Austin, Phoenix, San Antonio, Raleigh) saw pressure in 2024 and may remain soft near-term, while supply-constrained metros (Chicago, Cleveland, Cincinnati, Louisville) outperformed. Expect “clearer skies” in 2025 as demand remains supported by jobs and the cost gap between renting and owning.

Institutional outlooks echo the theme: CBRE calls for a cyclical recovery ahead, with 2025 vacancy trending to ~4.9% and ~2.6% rent growth, aided by diminishing starts and improving absorption, setting the stage for stronger gains in 2026.

Bottom line for investors: deal flow should improve as price discovery firms up and agency executions remain attractive. Selectivity is key: lower-supply markets and assets with clear operational levers (renovation, expense control, or affordability overlays) are positioned to outperform.