Tag Archives: real estate investing

Market Insights

22.4 Million Renters and Counting: Multifamily Renter Demand Hits a Record

Posted on by Jaiden Andus
Multifamily renter demand

Multifamily renter demand in the U.S. has quietly reached a historic milestone.

In 2025, the number of multifamily rental households climbed to 22.4 million, the highest level ever recorded, according to research from Chandan Economics and Arbor Realty Trust.

This isn’t a short-term spike or a post-pandemic anomaly. It’s the continuation of a multi-year structural shift that is reshaping the housing landscape—and creating long-term implications for investors focused on durable income and demand-backed assets.

A Growth Trend with Staying Power

Multifamily household formation has now grown at a steady 1.6%–1.8% annual rate for three consecutive years. From 2020 to 2025, the sector expanded by 15.4%, dramatically outpacing the 5.3% growth in total U.S. households over the same period.

 

22.4 Million Renters and Counting…

In absolute terms, the U.S. added nearly 3 million multifamily households over the past five years, the largest net gain since 2000.

For investors, the significance lies less in the headline number and more in the consistency. This level of growth suggests not a cyclical surge, but a durable rebalancing of where and how Americans choose, or are forced, to live.

Supply Has Risen—but So Has Absorption

Importantly, this demand growth has occurred alongside a historic wave of new supply. In 2024 alone, developers delivered 591,400 multifamily units, the highest annual total since 1974. Through August 2025, another 328,500 units came online, keeping completions elevated.

Rather than overwhelming the market, this supply surge has largely been absorbed.

Without it, household growth within multifamily would have been constrained, placing even greater pressure on rents and occupancy. Instead, new deliveries helped accommodate record demand while preventing excessive overheating in many markets.

This balance between supply and demand has been a key factor in the sector’s resilience.

Structural Demand Drivers Remain Intact

Several long-term forces continue to support multifamily growth.

The cost of homeownership has moved further out of reach, with mortgage payments, insurance, and taxes consuming approximately 43% of median household income, well above traditional affordability thresholds. At the same time, return-to-office policies have reinforced demand in employment-dense metros, particularly among renters seeking proximity and flexibility.

In certain Sun Belt markets, rising numbers of high-income renters are adding competitive pressure to the rental pool, further reinforcing demand even as new supply delivers.

Together, these forces suggest that multifamily demand is not solely a function of interest rates or short-term economic conditions, but a reflection of broader affordability and lifestyle realities.

What This Means For Investors in 2026

Despite record household counts and elevated deliveries, occupancy has remained relatively stable, and rent pressure has moderated rather than collapsed. This points to a market that is absorbing growth, not struggling under it.

As construction pipelines begin to normalize and demand drivers remain structurally intact, the multifamily sector is expected to enter 2026 on more balanced footing, characterized by steadier household growth, stabilized rents, and improved visibility for long-term investors.

For accredited investors, this matters because durable demand is the foundation of every successful multifamily strategy. Record household formation doesn’t guarantee outsized returns on its own, but it does create a strong base for disciplined operators, selective market exposure, and strategies focused on sustainability rather than speculation.

In a housing market defined by affordability constraints and evolving lifestyle preferences, multifamily’s growth story appears less cyclical and more structural, and increasingly difficult to ignore.

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

Commercial Real Estate: The Quiet Momentum Driving CRE Deals in 2026

Posted on by Jaiden Andus
Commercial real estate

For nearly two years, commercial real estate has lived in a fog of uncertainty. Elevated rates, inflation pressure, and valuation resets kept many investors watching from the sidelines. But as we close out 2025, the data is no longer ambiguous: the CRE market has regained its footing, and the setup for 2026 is the strongest we’ve seen since before the pandemic.

Below is what today’s numbers really say and what it means for accredited investors focused on multifamily.

The Capital Markets Are Waking Up

Three forces: lower rates, improving fundamentals, and surging refinancing activity are reshaping the landscape:

  • Loan originations jumped 48% YoY through Q3 to $587B, up from $395B in 2024.
  • Refis now make up 55% of all originations, unlocking transaction flow that had been frozen since 2022.
  • Bank lending is up 85%, CMBS issuance is up 37%, and insurance/agency lenders have expanded 29% and 41%.

This isn’t theoretical optimism, this is capital deployment at scale. When lenders return, transactions follow. And that’s exactly what we’re seeing.

Sales Activity Is Rebounding…Quietly but Powerfully

Investment sales climbed 19% YoY through Q3 to $350B, with two-thirds of transactions under $100M prime territory for sophisticated private investors.

Meanwhile:

  • 70% of properties sold in September traded above their prior purchase price, with an average gain of $10.2M.
  • Assets bought for $60–75M in 2018–2019 are now exiting at $90–100M.

While media headlines focus on distress, the transactional reality tells a very different story: appreciation is happening right now.

Multifamily Remains Best-in-Class

Despite pricing tightness and pockets of oversupply, multifamily still leads all property types with $42B in Q3 volume (up 10% YoY).

Why? Because the fundamentals—household formation, rent demand, affordability gaps, and migration patterns—remain structurally strong. Even in uncertain macro conditions, people still need housing.

Meanwhile:

  • Office and retail, the sectors many wrote off, are actually leading the rebound with sales up 25–29%.
  • Institutional buyers are reentering office in major markets, rising from 9% of acquisition volume in 2023 to nearly 40% in 2025.

The recovery is broader and more durable than expected.

A Recovery Rooted in Operations, Not Hype

Unlike past cycles driven by cap-rate compression or cheap debt, this one is powered by operational performance:

  • Renewed leasing momentum.
  • Stronger rent collections.
  • Stabilizing occupancy.
  • Better reporting and asset-level discipline.
  • Technology and AI reshaping underwriting, asset management, and deal sourcing.

In many ways, 2026 is poised to reward execution, not speculation.

What’s Fueling 2026 Momentum

1. Rates Are Declining And Confidence Is Rising

Two consecutive Fed cuts (down to 3.75–4%) haven’t transformed the market overnight, but they have created psychological momentum. Every 25–50 bps of relief improves refinancing math, cap stacks, and buyer confidence.

2. Debt Maturities Are Creating Forced Opportunities

The 2025–2027 maturity wave is massive. Many owners who held through high-rate environments will be forced to refi or sell, creating targeted opportunities for well-capitalized sponsors.

3. The Pricing Reset Already Happened

Most of the value correction occurred in 2023–2024. Investors waiting for “the bottom” may have already missed it. As CBRE forecasts 16–17% transaction growth by year-end, with double-digit gains throughout 2026, the early-mover advantage is fading.

4. Technology Is Separating Winners From Everyone Else

Big data, AI-enhanced underwriting, and integrated platforms are no longer competitive edges, they’re necessities. The groups deploying technology effectively are securing deals others never see.

What This Means for Accredited Investors

For accredited investors, the current environment offers a rare opening. Multifamily remains one of the most resilient asset classes, supported by strong demand, steady rent fundamentals, and long-term demographic tailwinds. Even with elevated rates, housing continues to outperform most sectors.

At the same time, the rebound in capital markets means more attractive deals are emerging, especially in the sub-$100M range where private investors have a clear advantage. Many of these opportunities are off-market or relationship-driven, favoring investors aligned with experienced, well-capitalized operators.

Success in this phase of the cycle will come from preparation and execution. Investors who partner with sponsors that have strong lender relationships, disciplined asset management, and access to early-stage deal flow will be positioned to capture outsized returns as the market continues to thaw.

The Bottom Line

Commercial real estate isn’t waiting for a comeback, it’s already shifting. Transaction activity is rising, confidence is returning, and multifamily fundamentals remain solid as we move toward 2026.

This moment offers meaningful asymmetry: uncertainty keeps some buyers on the sidelines, yet the underlying fundamentals support future upside. That gap won’t last forever. As more capital re-enters the market, competition and pricing will tighten.

For accredited investors, the next 12–18 months may be one of the most favorable windows of the cycle. Those who position capital now, before the recovery becomes obvious, will be best positioned to benefit from the momentum already forming beneath the surface.

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.
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.