Author Archives: Jaiden Andus

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Fannie Mae Multifamily Inspections: Why Oversight Is Increasing Nationwide

Posted on by Jaiden Andus
Fannie Mae multifamily inspections

GSE inspections are ramping up nationwide and the reason may go deeper than most think.

If you own or asset-manage multifamily properties financed through Fannie Mae, you may have noticed something unusual lately, unannounced inspections and even requests for new Property Condition Assessments (PCAs).

You’re not imagining it. This trend is spreading across portfolios nationwide, and it’s catching many operators off guard. The question is why now?

A Quick Refresher: What Is a GSE?

Fannie Mae (along with Freddie Mac) is a Government-Sponsored Enterprise (GSE) a federally chartered organization created to stabilize and support the U.S. housing market.

Rather than lending directly, GSEs buy and securitize loans from lenders, guaranteeing those mortgage-backed securities (MBS). That guarantee comes with strings attached strict standards, ongoing oversight, and compliance with the Multifamily Selling & Servicing Guide.

Why the Surprise Inspections and PCA Demands?

Over the past year, Fannie Mae has tightened its operational oversight. Several factors are driving the increased activity:

1. A Tougher Market and Rising Credit Risk

With interest rates at multi-decade highs, rent growth slowing, and delinquencies inching upward, Fannie Mae is taking a harder look at collateral quality. These inspections identify deferred maintenance or early signs of distress before losses occur.

2. Recent Guide Updates and Stricter Enforcement

Fannie Mae’s updated PCA guidance now classifies more items as “immediate repairs” from obsolete electrical systems to life-safety deficiencies. The message: compliance delays are no longer acceptable.

3. Deferred Maintenance in Older Assets

Many Class B and C communities are showing age. Deferred CapEx that built up post-COVID has become impossible to ignore. Fannie Mae isn’t waiting for defaults to uncover problems it’s proactively visiting assets.

4. Servicers Under Pressure

Servicers, acting on Fannie Mae’s behalf, are required to perform more on-site verifications for watch-list or at-risk loans. The result: more frequent inspections, shorter notice windows, and higher scrutiny.

A Personal Theory: The 2021–2022 Wave of New Operators

Here’s the part few are talking about and it may explain the sudden surge in oversight.

Between 2021 and 2022, multifamily experienced one of the largest influxes of new syndicators and operators in its history. Capital was abundant, rates were low, and value-add plays looked like a sure bet.

According to Newmark, multifamily investment volume hit $353 billion in 2021 and $294 billion in 2022, roughly 75 percent above pre-pandemic norms. That velocity invited first-time sponsors to chase Class B and C deals in fast-growing Sunbelt markets.

Meanwhile, crowdfunding and syndication platforms like CrowdStreet expanded rapidly, reporting billions in equity raised by late 2022. Smaller, newer operators suddenly had access to capital they’d never had before.

Then the cycle turned. Rates doubled. Insurance, payroll, and taxes skyrocketed. Rent growth flattened.

Many of those operators who built underwriting models on aggressive rent premiums and short value-add timelines had to divert CapEx to operations just to keep the lights on. Renovations stalled. Capital reserves evaporated. Assets slid into partial completion limbo.

It’s entirely plausible that Fannie Mae and other GSEs noticed. Their loans were underwritten on the assumption of completed upgrades and adequate reserves. When those improvements didn’t materialize, the physical condition of the collateral inevitably declined.

So while these “unannounced” inspections might feel abrupt, they’re likely a data-driven response to that 2021–2022 operator cohort an industry class that entered at the top of the market cycle and never fully executed its business plans.

Why It Feels Unannounced

Technically, Fannie Mae’s guide requires advance notice before inspections. But in practice, servicers facing higher risk scores are shortening lead times or conducting on-site visits with minimal notice.

To property teams, that feels like a surprise. To the GSE, it’s “enhanced surveillance.”

How Owners and Asset Managers Can Stay Ahead

  1. Review Your Loan Documents. Confirm inspection and PCA rights, some loan riders allow more aggressive timelines.
  2. Document Every Visit. Record date, attendees, and scope to maintain transparency.
  3. Audit Your Own Properties. Catch deferred items before the lender’s report does.
  4. Engage Your Servicer Proactively. Ask if your asset is under broader review or watch-list criteria.
  5. Revisit Reserves and Forecasts. Reclassify “deferred” into “immediate” where necessary and plan funding now.

The Bigger Picture

This isn’t about micromanagement, it’s about risk management. Fannie Mae’s actions reflect the reality of 2025’s market: tightening liquidity, aging assets, and the natural correction following a historic capital surge.

And perhaps, it’s also a marker of a maturing industry. When CapEx gets repurposed for survival, properties age faster and the agencies are watching.

Final Thought

This trend isn’t isolated to one region or asset class it’s a nationwide tightening of standards across GSE-backed multifamily loans.

Whether you manage 200 units or 2,000, now is the time to ensure your documentation, reporting, and property condition are bullet-proof.

Because when the GSE knocks, even unannounced, it’s too late to start cleaning up.

Meaghan Davenport President of Operations, Axxis Capital Helping owners and operators think bigger about performance, compliance, and accountability.

About the Author: Meaghan Davenport is a seasoned asset management executive and multifamily syndicator with a proven track record in operational turnarounds, value creation, and team leadership. Her work focuses on elevating industry standards through transparency, data-driven oversight, and collaboration between ownership, management, and investors.

Sources: Fannie Mae Multifamily Selling & Servicing Guide (2025); Newmark Multifamily Capital Markets Report (2022); CrowdStreet Annual Report (2022); CBRE U.S. Market Outlook (2022).

Uncategorized

Suburban Multifamily Investing: A Quiet Outperformer Amid Market Uncertainty

Posted on by Jaiden Andus
Suburban multifamily investing

While many are still focused on the turmoil in urban cores, savvy multifamily investors are quietly redirecting capital to suburban multifamily investing markets, where stability, strong demand, and structural growth are quietly reshaping opportunities. Amid this turbulence, one segment is quietly standing out: suburban multifamily. Recent insights from Cushman & Wakefield highlight that secondary and tertiary suburban markets are demonstrating stability in occupancy and sustained renter demand, trends that demand our attention as we consider the next deployment of capital.

Rethinking Market Allocation

Urban cores are grappling with oversupply, stagnant rent growth, and heightened competition. Suburban markets, by contrast, largely avoided the construction surge seen in major metros. Many secondary markets have not experienced the same supply shock, which has preserved pricing power and limited downside risk. For investors seeking stability, these markets are signaling an opportunity to allocate capital where fundamentals remain solid.

Affordability as a Structural Driver

Affordability continues to be a defining factor in suburban outperformance. Middle-market and workforce housing in these locations is attracting renters priced out of high-cost urban centers. Federal HUD initiatives targeting middle-income households are further supporting developers in meeting this demand. The implication is, suburban assets are not just a short-term refuge, they are positioned to capture structural demographic shifts and ongoing renter preferences.

Investment Fundamentals Are Compelling

Cap rate spreads have widened across the broader market, yet suburban Class A and B assets show relatively narrow pricing gaps. Even Class B- and C properties maintain consistent demand, supported by limited new supply. These dynamics reduce exposure to oversupply risk and create a buffer against market volatility, key considerations for investors balancing risk and yield. Cushman & Wakefield forecasts a gradual valuation recovery starting in Q4 2025, with institutional capital increasingly drawn to suburban markets supported by job growth, infrastructure development, and amenity expansion.

How Can You Position Yourself For Success?

  1. Seek Markets with Structural Demand – Focus on suburban markets with growing populations, strong job markets, and limited new supply. These factors support sustainable occupancy and rental growth.
  2. Target Middle-Market and Workforce Housing – Affordability is driving demand. Properties serving these renter segments often demonstrate resilient cash flows and lower turnover risk.
  3. Consider Mixed-Use Suburban Assets – Developments combining residential, retail, and commercial spaces enhance both tenant appeal and long-term property value appreciation.
  4. Anticipate Institutional Interest – As developers scale back and capital becomes selective, suburban assets are increasingly attractive to long-term investors seeking defensive positions in multifamily portfolios.

When You’re Ready… Here’s 3 Ways We Can Help:

  1. Connect With Our Team: Whether you’re exploring passive real estate for the first time or you’re a seasoned investor looking for a trusted partner, our team is available to answer your questions. Schedule a confidential strategy call to learn more about our investment philosophy, current opportunities, and how we help investors achieve income, growth, and tax efficiency. 
  2. Join Our Private Investor Portal: Gain exclusive access to our current offerings and ongoing pipeline of multifamily investments. Inside, you’ll find detailed financials, market insights, and structured deal overviews—all designed to help you make informed, confident decisions about where to place your capital.
  3. Review Our Investment Strategy: Get a clear understanding of how we source, underwrite, and manage multifamily assets. Our strategy is built around long-term wealth creation, consistent passive income, and disciplined risk management. Learn what sets us apart and why sophisticated investors choose to partner with us.
Market Insights

Policy Momentum Meets Market Opportunity: What the ROAD to Housing Act Means for Multifamily Investors

Posted on by Jaiden Andus
ROAD to Housing Act

As multifamily investors, we’re constantly navigating cycles of supply, demand, regulation, and financing. Last week, a meaningful policy development emerged that deserves attention, and perhaps, a strategic response.

On October 9, the U.S. Senate passed the ROAD to Housing Act, a bipartisan bill aimed squarely at increasing the nation’s housing supply and tackling affordability through regulatory reform.

While the bill still needs House approval, its implications for our space are already clear: the federal government is finally prioritizing supply-side solutions, and that shift could shape multifamily investment strategies over the next several years.

A Push Toward More Build-Friendly Policy

At its core, the ROAD to Housing Act aims to remove friction from the development process. It directs HUD to work with builders and local governments to establish best practices for zoning and land use reform, rewards municipalities that adopt pro-housing policies, and encourages the streamlining of environmental review and permitting at local levels.

In practical terms, this could:

  • Accelerate project timelines in growth markets where cities align with federal incentives.
  • Moderate construction costs over time by reducing regulatory burdens (which currently account for roughly 25% of a new home’s cost, per NAHB).
  • Unlock underutilized land through zoning reform, especially in suburban and infill areas that are ideal for workforce and attainable housing developments.

For investors, this means potential expansion of viable development pipelines in secondary and tertiary markets that were previously slowed by local resistance or zoning complexity.

Implications for Existing Owners

While more supply might sound like a headwind, it can actually create long-term stability in a market that’s been plagued by volatility in both rent growth and affordability pressure. By increasing overall housing availability, the legislation could:

By addressing affordability through increased housing construction rather than rent control, the legislation could help ease political and regulatory pressure on landlords. Over time, this approach may promote healthier rent growth patterns, smoothing out the extreme peaks and troughs experienced in recent years and creating more sustainable, predictable performance for multifamily assets. Additionally, as local markets adopt clearer, standardized policy frameworks, investor confidence and liquidity are likely to improve, supporting overall valuation stability across the sector.

In short, while the ROAD to Housing Act won’t flood the market with new units overnight, it could de-risk multifamily ownership over the long term by creating a more balanced policy environment.

Strategic Takeaways for Investors

While the bill’s passage through the Senate doesn’t immediately move markets, it does provide valuable insight into where housing policy, and therefore capital, may be heading. Here are several implications worth watching:

  1. Markets that embrace pro-housing reforms could see faster permitting and growth. Investors might want to monitor cities and counties that quickly align with HUD’s forthcoming best-practices framework. These jurisdictions may become development-friendly zones for new multifamily supply.
  2. Construction cost inflation could moderate over time, improving new-build feasibility, especially for value-add developers looking to pivot into light construction or redevelopment plays.
  3. Existing stabilized assets in tight supply markets may hold premium value over the next 12–24 months as the new policy framework takes time to translate into actual units.
  4. Policy predictability is returning, and with it, the confidence needed for institutional capital to re-enter select development markets.

Looking Ahead

The bill still faces political delays in the House, but the bipartisan momentum behind housing reform appears strong. When housing supply becomes a national priority, it tends to reshape investment risk across the board, from entitlement timelines to financing conditions.

For now, multifamily investors should view this as a signal of longer-term structural support for the industry. The ROAD to Housing Act won’t reverse today’s high construction costs or capital market challenges overnight, but it reinforces one of the most investable themes of the next cycle: policy-driven expansion of housing supply and the opportunities it creates for well-capitalized investors positioned to move early.

When You’re Ready… Here’s 3 Ways We Can Help:

 

  1. Connect With Our Team: Whether you’re exploring passive real estate for the first time or you’re a seasoned investor looking for a trusted partner, our team is available to answer your questions. Schedule a confidential strategy call to learn more about our investment philosophy, current opportunities, and how we help investors achieve income, growth, and tax efficiency. 
  2. Join Our Private Investor Portal: Gain exclusive access to our current offerings and ongoing pipeline of multifamily investments. Inside, you’ll find detailed financials, market insights, and structured deal overviews—all designed to help you make informed, confident decisions about where to place your capital. 
  3. Review Our Investment Strategy: Get a clear understanding of how we source, underwrite, and manage multifamily assets. Our strategy is built around long-term wealth creation, consistent passive income, and disciplined risk management. Learn what sets us apart and why sophisticated investors choose to partner with us.

 

Real Estate Investing, Market Insights

Housing Constraints Are Driving Multifamily Demand

Posted on by Jaiden Andus
Housing Constraints Are Driving Multifamily Demand

For investors seeking stable cash flow and long-term value creation, multifamily real estate continues to stand out as one of the most resilient and strategically positioned asset classes. Against the backdrop of affordability challenges in the single-family market and an ongoing national housing shortage, multifamily properties are playing an increasingly critical role in meeting U.S. housing demand.

Single-Family Challenges Drive Multifamily Growth

Homeownership remains aspirational, but affordability continues to be the central barrier. While mortgage rates have recently eased to 6.58% on a 30-year fixed loan, elevated borrowing costs have kept many middle-income households on the sidelines. 

The result: single-family home sales declined 2.7% in June, according to the National Association of Realtors, even as inventories reached 20-year highs, while the median new home price fell 6.2%, reflecting ongoing softness in the market.

For those allocating capital: when purchasing a home is out of reach, households rent instead. Multifamily real estate stands ready to absorb this demand and provide dependable returns.

This highlights how multifamily demand is becoming a central driver of investment performance in today’s housing market.

Growing Demand Supports Multifamily Performance

The multifamily sector has responded with strength. In Q2 2025, net absorption rose 47% year-over-year, marking the highest second-quarter performance in over three decades. Vacancy declined to 4.1%, well below long-term averages, despite elevated levels of new construction. Effective rents are rising again, with June registering the fastest annual increase since mid-2023.

These dynamics reflect both cyclical and structural tailwinds. Cyclically, multifamily benefits as single-family affordability declines. Structurally, the U.S. remains short an estimated 2 million homes, with unmet demand concentrated in growth markets across the Sun Belt, Southwest, and Midwest.

Navigating Today’s Market Environment

While demand is strong, today’s investment environment requires selectivity. Elevated construction pipelines in certain metros are likely to put short-term pressure on vacancy rates and temper rent growth. Forecasts for 2025 call for national rent growth of 2.2%, slightly below the historical average, as supply continues to be absorbed.

On the capital markets side, transaction volume is expected to rebound moderately in 2025, reaching $370–$380 billion. This is being driven by loan maturities requiring refinancing, sidelined capital reentering the market, and increasing price stability. For investors, this creates a window to acquire quality assets in strong locations at more attractive entry points than were available just two years ago.

Strategic Takeaways

  1. Prioritize Fundamentals Over Headlines: Focus on metros with strong job growth, diversified economies, and limited new supply. These markets are best positioned to deliver durable returns. 
  2. Be Selective on Timing: Elevated supply is a short-term factor. Investors with a medium- to long-term horizon stand to benefit as new construction moderates in 2026 and beyond. 
  3. Evaluate Risk-Adjusted Returns: With spreads narrowing, look closely at sponsor experience, leverage levels, and deal structures. In this environment, execution matters more than ever.

For high-net-worth investors balancing wealth preservation with growth, multifamily real estate continues to present a compelling opportunity. The sector’s resilience amid economic uncertainty, coupled with structural housing shortages and demographic demand, positions it as a core component of a diversified investment strategy.

As affordability challenges persist in the single-family sector, multifamily is not just filling the gap—it is shaping the future of U.S. housing. For investors, that means a chance to position capital where long-term demand is both clear and durable.

When You’re Ready… Here’s 3 Ways We Can Help:

  1. Connect With Our Team: Whether you’re exploring passive real estate for the first time or you’re a seasoned investor looking for a trusted partner, our team is available to answer your questions. Schedule a confidential strategy call to learn more about our investment philosophy, current opportunities, and how we help investors achieve income, growth, and tax efficiency. 
  2. Join Our Private Investor Portal: Gain exclusive access to our current offerings and ongoing pipeline of multifamily investments. Inside, you’ll find detailed financials, market insights, and structured deal overviews—all designed to help you make informed, confident decisions about where to place your capital. 
  3. Review Our Investment Strategy: Get a clear understanding of how we source, underwrite, and manage multifamily assets. Our strategy is built around long-term wealth creation, consistent passive income, and disciplined risk management. Learn what sets us apart and why sophisticated investors choose to partner with us.
Real Estate Investing

Why Market Cycles Matter and What They Signal for Multifamily Investors

Posted on by Jaiden Andus
Multifamily Market Cycles

Most investors know markets don’t move in straight lines. Real estate, in particular, runs in cycles, rising, peaking, correcting, and recovering in a rhythm that can swing prices by 30% or more over the course of a decade. For multifamily investors, staying attuned to multifamily market cycles is critical. It shapes not just when we buy or sell, but also how we position capital to maximize returns and manage risk.

The Four Phases of the Real Estate Cycle

Like the broader economy, real estate tends to repeat four phases:

  1. Recovery – The market begins to heal after a downturn. Vacancies start to tighten, rents stabilize, and confidence creeps back.

  2. Expansion – Growth kicks in. Rents rise, demand is strong, and new development ramps up. This is often the most optimistic—and competitive—phase.

  3. Hypersupply – Builders overshoot, supply outpaces demand, and vacancies creep higher. Rent growth slows or stalls.

  4. Recession – Excess supply and weaker demand push values and rents lower. Distress emerges, but so do some of the best long-term opportunities.

Each phase offers opportunities, but the right strategy depends on where the market stands.

Where We Are in 2025

Looking across today’s market, we’re somewhere between late correction and early recovery. The rapid interest rate hikes of the past two years slowed home sales and pressured multifamily rent growth in several high-growth metros. In some Sun Belt markets, year-over-year rents have even dipped. Meanwhile, tighter credit conditions and maturing loans are creating stress for owners who bought at peak valuations.

At the same time, supply pipelines are starting to thin, demographic demand remains strong, and inflation is easing. History suggests these are the ingredients that set the stage for the next recovery.

What the Past Teaches Us

If we look back over the last 25 years, the pattern is familiar:

  • Early 2000s Expansion: Strong growth, easy credit, and overbuilding.

  • 2007–2011 Downturn: Prices corrected sharply, creating once-in-a-generation buying opportunities.

  • 2012–2019 Expansion: One of the longest growth cycles in history, with multifamily at the forefront.

  • 2020–2022 Surge: Pandemic-driven demand and low rates fueled record rent growth and appreciation.

  • 2023–2025 Reset: Higher borrowing costs and affordability challenges are forcing a reset in pricing.

Cycles repeat. The investors who consistently outperform are those who act when uncertainty is high, rather than waiting for headlines to turn positive.

Preparing for the Next Phase

If we are indeed moving into early recovery, this is the time to sharpen pencils and prepare for opportunities:

  • Keep liquidity ready – Distressed and recapitalization deals are already emerging as loans mature.

  • Focus on strong markets – Job growth, population inflows, and supply-constrained areas will rebound fastest.

  • Lean into value-add – Repositioning well-located assets during recovery often delivers outsized returns.

  • Watch rates closely – As the Fed eases, lower borrowing costs could accelerate the next expansion.

Final Thoughts

Real estate is cyclical by nature. Prices rise, correct, and recover. It’s a pattern we’ve seen repeatedly. What matters is how we respond.

Today’s environment is uncertain, but uncertainty is often the prelude to opportunity. For multifamily investors with patience, discipline, and capital at the ready, the next cycle could prove especially rewarding.

Now is the time to prepare, so that when the market begins its next leg up, you’re positioned to take advantage.

When You’re Ready… Here’s 3 Ways We Can Help:

  1. Connect With Our Team: Whether you’re exploring passive real estate for the first time or you’re a seasoned investor looking for a trusted partner, our team is available to answer your questions. Schedule a confidential strategy call to learn more about our investment philosophy, current opportunities, and how we help investors achieve income, growth, and tax efficiency.

  2. Join Our Private Investor Portal: Gain exclusive access to our current offerings and ongoing pipeline of multifamily investments. Inside, you’ll find detailed financials, market insights, and structured deal overviews—all designed to help you make informed, confident decisions about where to place your capital.

  3. Review Our Investment Strategy: Get a clear understanding of how we source, underwrite, and manage multifamily assets. Our strategy is built around long-term wealth creation, consistent passive income, and disciplined risk management. Learn what sets us apart and why sophisticated investors choose to partner with us.

 

Real Estate Investing

What the Fed’s Rate Cuts (or Holds) Mean for Multifamily Real Estate Investors

Posted on by Jaiden Andus
Multifamily Real Estate

What the Fed’s Rate Cuts (or Holds) Mean for Multifamily Real Estate Investors

Multifamily Real Estate

 

For investors with significant capital at work, the question in today’s environment isn’t whether to invest, but where to invest intelligently.

Following the latest Federal Reserve meeting, it’s clear we are in a holding pattern. The Fed chose not to cut rates, instead signaling a cautious stance as inflation moderates and the labor market remains relatively strong. While market participants had hoped for more immediate relief, the message is clear: the Fed is not in a rush, and any future rate cuts will come gradually, likely in late 2025 or beyond.

This decision has broad implications across capital markets, but for those looking to preserve wealth, create passive income, and reduce tax exposure, it also sharpens the spotlight on one specific asset class: multifamily real estate.

High Rates Haven’t Changed the Fundamentals…They’ve Just Changed the Entry Point

Yes, the cost of capital is higher than it was in 2021. But here’s what many investors miss: higher rates have created opportunity, not just friction. During the low-rate years, multifamily assets were heavily bid up, cap rates compressed to unsustainable levels, and buyers were often over-leveraged chasing future rent growth.

That environment has changed. Cap rates have expanded. Buyer competition has cooled. Many owners who financed properties with floating-rate debt are under pressure to exit. This combination of softer pricing and motivated sellers has created a window that experienced operators are beginning to act on.

At the same time, multifamily fundamentals remain solid. Occupancy is strong in most major markets. Rents are holding up, particularly in Class B and workforce housing, where the affordability gap continues to widen. And most importantly, the structural undersupply of housing in the U.S. has not gone away. If anything, it’s become more pronounced. According to recent data, the U.S. still faces a shortage of over 4 million housing units. That demand pressure supports long-term rent growth and asset appreciation, regardless of short-term rate movements.

For High Earners, the Case for Multifamily is Multi-Dimensional

If you’re earning $300,000, $500,000 or even $1M+ annually, you’re likely experiencing a common problem: your income is growing, but your tax liability is growing faster. And while your portfolio may be heavily weighted in stocks, bonds, or high-fee managed funds, few of those assets provide meaningful tax relief or consistent passive income.

This is where multifamily investing offers unique advantages that align directly with the financial priorities of high net worth investors:

  1. Passive Income with Real Assets: Through syndications or direct equity investments, multifamily properties provide monthly or quarterly cash flow backed by real tenants, operating businesses, and appreciating assets. This is income from a tangible source, in markets with persistent housing demand.
  2. Significant Tax Benefits: The U.S. tax code is highly favorable to real estate investors with the recent passing of the “Big Beautiful Bill” back in July. Through bonus depreciation, cost segregation studies, and passive loss offsets, investors can often significantly reduce or even eliminate taxable income from distributions. This is especially compelling for high earners who are otherwise taxed at top marginal rates.
  3. Compounding Wealth Without Active Involvement: Most high-net-worth professionals don’t have the time or interest to become landlords. Multifamily syndications offer the ability to participate in the same equity growth as a principal, without the operational headaches. You benefit from the upside while a professional team handles acquisition, management, renovation, and eventual exit.
  4. Recession-Resilient Asset Class: Multifamily has proven to be one of the most resilient sectors in commercial real estate. During economic downturns, people may downsize from homeownership or luxury apartments, but they still need a place to live. In the past five economic cycles, multifamily has consistently outperformed office and retail, and maintained more stable occupancy and income.

Why This Moment Matters

With rates holding steady and cuts pushed further out, many investors are sitting on the sidelines, waiting for perfect clarity. But the reality is: the best deals rarely come when everyone is confident. They come during transition periods when pricing hasn’t yet caught up to forward-looking fundamentals.

Experienced operators are using this environment to acquire assets at discounted valuations, often with assumable fixed-rate debt or structured seller financing. These are not speculative acquisitions, but carefully underwritten investments that prioritize stabilized cash flow and long-term equity creation.

Additionally, as the debt markets stabilize, we’re seeing improved terms from agency lenders like Fannie Mae and Freddie Mac, especially for deals in strong demographic markets with proven demand. This creates a rare combination: lower acquisition prices, improving debt terms, and resilient operating performance.

For investors focused on preserving and compounding wealth, this is the environment where long-term gains are seeded.

When You’re Ready… Here’s 3 Ways We Can Help:

  1. Connect With Our Team: Whether you’re exploring passive real estate for the first time or you’re a seasoned investor looking for a trusted partner, our team is available to answer your questions. Schedule a confidential strategy call to learn more about our investment philosophy, current opportunities, and how we help investors achieve income, growth, and tax efficiency.
  2. Join Our Private Investor Portal: Gain exclusive access to our current offerings and ongoing pipeline of multifamily investments. Inside, you’ll find detailed financials, market insights, and structured deal overviews—all designed to help you make informed, confident decisions about where to place your capital.
  3. Review Our Investment Strategy: Get a clear understanding of how we source, underwrite, and manage multifamily assets. Our strategy is built around long-term wealth creation, consistent passive income, and disciplined risk management. Learn what sets us apart and why sophisticated investors choose to partner with us.
Tax Benefits

How the ‘Big Beautiful Bill’ Creates Bigger Returns for Real Estate Investors

Posted on by Jaiden Andus
Multifamily Real Estate

Multifamily Real Estate

Occasionally, legislation quietly reshapes how wealth is built—and most people miss it. The recent passage of the One Big Beautiful Bill Act (OBBBA) is one of those rare moments. While much of the public conversation focuses on politics, investors should pay attention to what really matters: taxes.

Taxes are often the largest lifetime expense you’ll face, exceeding housing, education, or healthcare. That’s why understanding and leveraging favorable tax policies isn’t optional; it’s essential to creating lasting wealth.

This new bill creates one of the most advantageous tax environments in years, especially for real estate investors. Whether you’re already invested in multifamily syndications or exploring new opportunities, these changes can help you keep more of your earnings, lower your tax burden, and accelerate your path to financial freedom.

When approached strategically, tax efficiency isn’t just an added bonus—it’s a fundamental driver of wealth growth.

Here’s what’s changed and why it matters for your investment strategy:

Lower Tax Rates Are Now Permanent

The 2017 Tax Cuts and Jobs Act (TCJA) introduced reduced tax brackets for individuals, but those reductions were originally set to expire in 2025. Under the new legislation, these rates have now been made permanent.

The key brackets include:

  • 24%, which is where many investors’ passive income lands.
  • 37% as the top rate (instead of reverting to nearly 40%).

Additionally, the standard deduction remains $15,750 for individuals and $31,500 for joint filers, with ongoing inflation adjustments.

What this means for you: The income you receive from K-1s and other passive sources will continue to be taxed at favorable rates, ensuring your after-tax income remains strong and predictable over time. This is a structural win that provides clarity for long-term planning and confidence in the net cash flow you can expect from your investments.

Bonus Depreciation Fully Restored and Made Permanent

Perhaps the most significant change in the bill for real estate investors is the return, and permanence, of 100% bonus depreciation for qualifying commercial real estate assets placed in service after January 19, 2025.

What qualifies?

Systems like HVAC, elevators, tenant improvements, landscaping, and other capital-intensive components. These can now be fully expensed in the year of acquisition, rather than depreciated over 15 to 39 years.

For passive investors: This translates into large paper losses on your K-1s. While these losses don’t impact cash flow, they are extremely valuable in reducing taxable income, either from the same investment or from other passive income sources.

20% Deduction on Rental Income Becomes Permanent

The Qualified Business Income (QBI) deduction, commonly referred to as the 20% pass-through deduction, has now been made permanent under the new legislation. 

Why this matters: For passive investors who are focused on optimizing after-tax yield, this becomes a built-in efficiency that doesn’t require restructuring or complicated strategies. It’s automatic, and it’s permanent.

1031 Exchanges Remain Intact

Despite prior discussions in Congress about eliminating or limiting 1031 exchanges, this bill has left them fully intact.

Investors can continue to sell investment properties and reinvest the proceeds into qualifying properties while deferring capital gains taxes.

Increased SALT Deduction for High-Tax-State Residents

Previously, state and local tax (SALT) deductions were capped at $10,000, which disproportionately impacted investors in high-tax states. OBBBA raises this cap to $40,000 for households with adjusted gross incomes under $500,000.

Capital Gains Tax Rates Remain Favorable

The favorable rates for long-term capital gains, typically 15% or 20% depending on income, remain in place.

Investor takeaway: When you realize gains from the sale of a property after holding it for a year or more, those profits will continue to be taxed at significantly lower rates than ordinary income. 

Real Estate Professionals Maintain Their Full Advantage

If you or your spouse qualify as a Real Estate Professional under IRS rules, you can continue to use passive losses, particularly from bonus depreciation, to offset active income like W-2 wages. For high-income households, this can lead to significant tax deferral or immediate savings. 

Additional Incentives for Affordable Housing and Opportunity Zones

In an effort to support underserved communities and address housing shortages, the bill expands the Low-Income Housing Tax Credit (LIHTC) and enhances benefits tied to Opportunity Zone investments. If you’re considering projects that blend financial returns with social impact, these incentives can improve overall project economics and provide additional federal tax credits.

Faster Federal Permitting for New Developments

The bill also includes a provision to streamline environmental and regulatory approvals for new construction, particularly in multifamily and commercial real estate. This reduces project delays and administrative bottlenecks.

For passive investors: This could translate into faster project starts, shorter construction timelines, and quicker transitions to stabilized income-producing assets.

What You Can Do Today

Taken together, these provisions make long-term real estate investing more attractive, predictable, and rewarding. For investors looking to scale their portfolios without added active work, maximize after-tax returns, and balance capital preservation with income generation, this bill creates a strategic opportunity by aligning tax policy with investment strategy.

  1. Consult with your CPA: Review your tax strategy in light of these changes, especially around depreciation, QBI deductions, and real estate professional status.
  2. Evaluate your current portfolio: Consider how these updates impact your after-tax returns and your capital allocation plans.
  3. Position yourself for upcoming offerings: Properties placed into service in 2025 will qualify for new bonus depreciation rules, timing matters.

Final Thoughts

We’ve always believed that real estate is more than just a way to generate returns, it’s a way to build durable wealth, protect capital, and create time freedom.

This new legislation reinforces that belief. The path ahead is clearer, more tax-efficient, and more aligned with the long-term investor’s goals. And while most will overlook it, those who plan intentionally and invest accordingly will benefit the most.