Multifamily Outlook 2026
Supply constraints and structural demand create a compelling setup for the next investment cycle.
- Supply cliff emerging: Multifamily starts have dropped significantly from prior peaks, setting up a future shortage of new supply as 2026 starts deliver into 2028–2029.
- Renting remains more affordable: The cost gap between renting and owning is at one of its widest levels in over 20 years, supporting sustained renter demand.
- Operational performance is key: Operators are prioritizing efficiency and NOI growth, increasingly leveraging technology and AI to improve leasing, collections and margins.
- Near-term pressure from concessions: Strong demand is being offset by elevated concessions as operators prioritize occupancy, limiting rent growth in the near term.
- Regional divergence continues: Midwest markets are outperforming on rent growth with limited supply, while other regions adjust to recent inventory expansion.
The full report explores detailed data, regional insights and key themes shaping the multifamily market.
Baird’s Real Estate Private Capital and Advisory Team has completed more than 50 transactions totaling $7 Billion of total transaction value and provides expert advice on acquisitions/dispositions, joint-venture formations and programmatic partnerships with institutional investors.
