What to Watch for in 2026

While 2025 might be in the rearview mirror, many of its economic trends carry into 2026. These are a few to watch that influence demand for multifamily.

Can the labor market rebound and spur household formation? It was one of the biggest disappointments of last year, with essentially no job growth after April. Supply will be lower than recent peaks, but it won’t completely disappear. Many markets in the Southeast and Southwest regions rely on strong job creation and migration to fill those units.

How might a continued “K-shaped” economy impact rent growth? While consumer spending helped boost GDP in 2025, there was a significant divide based on income levels. Much of the spending was from top earners, while those with more moderate incomes were sensitive to inflation on essentials such as food and utilities. This trend could be a headwind for revenue growth, especially for properties with mid-to-lower rent levels.

Will the frozen single-family market start to thaw? Existing home sales saw a slight rebound near the end of 2025, but they remained well below normal levels. The typical first-time home buyer is now 40 years of age, a record high. While the lack of affordability has kept people in rental housing longer, a positive for demand in the industry, it likely stunted job growth and spending that would have helped the broader economy.

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