Multifamily entered 2026 expecting a turnaround. Interest rates were supposed to come down, and rent growth was supposed to follow. Halfway through the year, neither has happened. Yardi Matrix forecasts just 0.5% growth for the full year.
But that flat national number hides a more interesting story underneath.
Depending on where your properties are located, 2026 either looks like a genuine recovery or a third straight year of scraping by. Using the Yardi Matrix U.S. Multifamily Outlook for Summer 2026 as a guide, this article breaks down what’s driving the split and what it means for small landlords and operators.
Key takeaways
- Rents are flat nationally, but the split by market is wide
- Supply is the real driver, not demand
- The pipeline is thinning as starts fall, which should ease pressure over the next couple of years
- Deals are stuck on price, not capital (sellers are holding out, buyers are waiting)
- Lending is active, so this may be a good window to revisit financing
- Local conditions beat national trends every time — know what’s being built near you before you set rates
Rising & falling rent
The gap between the strongest and weakest metros is the defining feature of this cycle. Since the start of 2023, rents have climbed 18.4% in New York, 13.3% in Chicago, 11.8% in Kansas City and 10% in Columbus, Ohio. Over the same stretch, they’ve fallen 14.7% in Austin, 9.2% in Phoenix and roughly 5% in Atlanta, Orlando, Raleigh-Durham and Denver. Matrix expects the pattern to hold through year end.
The difference comes down to supply, not demand. The Midwest and Northeast built relatively little over the past three years, whereas the Sun Belt and Mountain West built a lot. Austin alone added 87,000 units since 2023, expanding its inventory by 32%. Charlotte grew 27%, Nashville 24% and Phoenix 23%.
Here’s the part that surprises people: Those high-supply markets are still leasing well. Austin absorbed units equal to 6.1% of its stock over the past year, the highest rate in the country. Renters want to live there. There are simply more new apartments than even strong demand can fill, and lease-up competition keeps pushing advertised rents down.
The supply overhang is shrinking slowly
Relief is coming, but the pipeline empties one lease at a time.
Nearly 1.3 million units nationally are in lease-up, about 6.9% of total inventory. The pre-pandemic norm was roughly 700,000 units, or 4.7%. Add the 488,000 deliveries Matrix forecasts for 2026, and the market has close to 1.8 million units to absorb.
Meanwhile, absorption is decelerating. Slower absorption stretches out lease-up timelines and delays the point at which owners regain pricing power.
There’s better news at the front end of the pipeline. Multifamily starts peaked in 2022, fell in both 2024 and 2025, then dropped sharply again in early 2026. Matrix recorded about 80,000 starts in the first quarter, the lowest total since 2017. Every project that doesn’t break ground now is one less brand-new competitor for your residents in 2027 and 2028. Deliveries will stay elevated in the near term, but there’s less pressure overall.
Most high-supply metros, including Atlanta, Charlotte, Denver, Nashville, Orlando, Phoenix and Raleigh-Durham, are projected to return to positive rent growth by the end of 2028.
The national economy is holding the market back
If supply explains the regional split, the overall economy explains why the national number is so muted. Inflation, pushed higher in part by global energy disruptions, hit 3.8% in April and has kept the Federal Reserve from cutting rates. Consumer sentiment sits at its lowest level on record and household debt reached $18.8 trillion in the first quarter. The personal savings rate fell to 2.6%, one of the lowest readings since 1960. Job growth has been positive but thin, with about 500,000 jobs added over the 12 months through May.
In all this, there’s one durable tailwind: the for-sale housing market. High home prices and elevated mortgage rates are keeping would-be buyers in the rental pool longer, and firm occupancy suggests renters are staying put rather than transitioning to ownership.
Deals are stuck, but money isn’t
Transaction activity tells its own story about the year. Matrix recorded $26.6 billion in multifamily sales through May, down 10.7% from the same period in 2025. Plenty of capital is waiting to be deployed. The problem is sellers, many of whom are holding out for pricing that today’s interest rates can’t support. With rate cuts on hold, the standoff continues.
Lending, on the other hand, is busy. Fannie Mae originated $17.1 billion in the first quarter, up 45% year-over-year, with nearly two-thirds of that volume coming from refinancings. Freddie Mac’s originations rose 25%. Banks, debt funds and other lenders are competing hard for deals. For smaller owners, that’s a meaningful detail. Acquisitions may be hard to pencil right now, but if you have a loan maturing or rate-sensitive debt on the books, lenders want your business.
What small and mid-sized operators should focus on
National data sets the backdrop, but your results this year will come down to a handful of local, controllable factors.
Protect renewals
Occupancy has held up in large part because owners are prioritizing retention with modest renewal increases and, where necessary, concessions. In markets with heavy lease-up activity, every expiring lease is a chance for your resident to tour a brand-new property offering six weeks free. In other words, price renewals with competition in mind. Keeping a good resident at a modest increase beats re-leasing at a street rent that’s been dragged down by the building across the road.
Know your local pipeline
National starts are falling, but deliveries remain concentrated. A single large project opening nearby affects your pricing more than any national trend. Track what’s under construction in your submarket and time your rate decisions around it.
Control your expenses
When revenue growth is measured in fractions of a percent, expense control does the heavy lifting. Insurance, taxes and maintenance costs haven’t gotten the memo about flat rents. We covered this in depth in our article on rising property expenses. To summarize it in one sentence: operators getting ahead this year are the ones watching costs line by line.
Let your software carry more of the load
Larger operators are navigating this market with real-time reporting, centralized pricing and automated workflows. Those advantages are no longer exclusive to them. All-in-one property management software like Yardi Breeze puts accounting, leasing, maintenance and reporting in one place, so you can see occupancy and expense trends as they happen instead of a month later.
What should small landlords do?
Multifamily in 2026 may test your patience, but there is light at the end of the tunnel. Demand is real, capital is abundant and the construction slowdown means better pricing power is on the way. It just isn’t arriving this year for most of the country.
For small landlords, this is a year to put your defensive genius on display. Resident retention is at a premium, as is expense management and local market knowledge. The owners who handle all of that well will be positioned to move quickly when rent growth returns.
