Investors Bullish on Multifamily: Will It Last?

New data on investor sentiment shows optimism in the multifamily market, but given the lag between fast-moving economic developments and the Jan.-Feb. time period when the data was gathered, some of this investor enthusiasm may be blunted in light of the recent volatility. That being said, strong fundamentals and improving long-term rent growth trends have been consistent in the multifamily market, and as short-term revenue difficulties intersect with looming loan maturities, investors will be looking for opportunities to invest in distressed assets as the year progresses.

Multifamily, the Nation, and the Economy

Multifamily and the Housing Market

1Q25 Fear and Greed Survey

CRE Daily/John Burns Research and Consulting: “The Fear and Greed Index remained flat in 1Q25 from 4Q24. Commercial real estate investors lowered their expectations for near-term investment.”

Multifamily Markets and Reports

Feb. 2025 National Multifamily Report: “Multifamily Market Set to be Tested”

Yardi Matrix: “Will demand remain robust? If so, fewer deliveries would allow high-supply markets to absorb new units and enable rents to grow again. However, early indications are that demand is weakening as absorption drivers are slowing.”

Commercial Real Estate and the Macro Economy

On Again, Off Again: Tariffs & Commercial Real Estate

Via CBRE: “Industrial and retail property fundamentals will see the most immediate impacts from tariffs if consumer spending power is reduced and the flow of goods shifts. The office market recovery should continue, barring an economic downturn.”

Other Real Estate News and Reports

Searching for Office’s Alpha

Via MSCI: “While the office-property market continues to evolve amid structural challenges, PME analysis shows that a wait-and-see approach has typically not been the route to outperforming the broader real-estate market. Instead, returns-enhancing opportunities are more likely to be found in pursuing development at the outset and timing exits well.”