Author: Multifamily News

Fear Returns To The Multifamily Market In The Second Quarter Of 2026

The latest JBREC index shows a more cautious investment environment in Q2 2026 as rising inflation concerns, higher borrowing costs, and policy uncertainty weigh on multifamily sentiment.

Index values below 45 indicate a contracting market, while readings above 55 suggest expansion. Values between 45 and 55 reflect a market balanced between buyers and sellers.

  • 33% of multifamily investors said capital conditions tightened quarter-over-quarter, versus just 16% who reported improvement.
  • 72% of investors reported modifying acquisition underwriting, most commonly by increasing reserve and operating expense assumptions, raising financing cost expectations, and revising rent growth forecasts.
  • 65% expect rent growth in high-supply Sunbelt markets to stay below 3% through 2028.
  • 63% remain on the sidelines.

Build-to-rent investors largely hit pause during the quarter as uncertainty surrounding the 21st Century Road to Housing Act weighed on new investment decisions. Nearly two-thirds of investors paused future allocations, while 28% redirected capital elsewhere. 

Source: John Burns

Multifamily Construction Costs Surged Higher In May

Overall construction materials costs increased 2.6% month over month in May and are now up 9.6% over the past year. Construction input costs have gotten pricier every month this year, and they’re rising at the fastest annual rate since the pandemic. Contractors are being hit by a double whammy of rising materials prices and much lower increases in what they can charge for new projects.

Source: Multifamily Dive

Private vs. Public Cap Rates

Cap rates for REITs continue to trade about 100 basis points higher than the 10-year treasury, but private companies continue to value their real estate below the 10-year treasury yield (with internal appraisal cap rates).

Either REITs are priced too cheap or the internal private real estate marks are too high.

Source: Nareit

Brand New Multifamily Selling At Higher Cap Rates Than Older Vintage Properties

One of the multifamily sector’s most reliable pricing anchors has been flipped upside down: in many trades today, brand‑new Class A assets are selling at higher cap rates than older value‑add product.

With core and core‑plus funds largely sidelined the last few years, value‑add buyers have become the marginal price setters and they are underwriting newer deals with a very different set of return targets. These investors are paying up for older stock they can actively improve, while demanding a discount on new deliveries that offer less scope for forced appreciation.

The capital most eager to transact today is not looking for long‑duration, bond‑like income streams; it is looking for upside. The result is an upside‑down yield curve by vintage that would have been hard to imagine a few years ago.

Source: Globe St.

PODS 2026 Moving Trends Report

This week PODS unveiled their sixth annual Moving Trends Report, highlighting the U.S. cities with the most move-ins and move-outs. The Carolinas dominated the top 6.

Top 10 cities with the highest number of move-ins:

  1. Myrtle Beach, SC-Wilmington, NC (1st in 2025)
  2. Ocala, FL (2nd in 2025)
  3. Dallas-Fort Worth, TX (5th in 2025)
  4. Raleigh, NC (3rd in 2025)
  5. Greenville-Spartanburg, SC (4th in 2025)
  6. Charlotte, NC (6th in 2025)
  7. Boise, ID (7th in 2025)
  8. Knoxville, TN (8th in 2025)
  9. Sarasota, FL (unranked in 2025)
  10. Jacksonville, FL (10th in 2025)

Once again, Wilmington, NC, proves to be one of the most popular places to move to in the country.

Affordability overtook career as the number one deciding factor for moving Americans, with 58 percent of respondents claiming it as a top motivator. Up next at 41 percent was community and connection. 

Top 10 cities with the highest number of move-outs:

  1. Los Angeles, CA (1st in 2025)
  2. South Florida (Miami area) (3rd in 2025)
  3. Northern California (San Francisco area) (2nd in 2025)
  4. Washington, D.C. (14th in 2025)
  5. Long Island, NY (Serving parts of NYC) (4th in 2025)
  6. Central Jersey, NJ (6th in 2025)
  7. Boston, MA (8th in 2025)
  8. Hudson Valley, NY (9th in 2025)
  9. Chicago, IL (7th in 2025)
  10. San Diego, CA (5th in 2025)

Source: PODS