Arbor Realty Trust’s Small Multifamily Investment Trends Report Q1 2026, developed in partnership with Chandan Economics, shows that lending activity in the sector increased for the second consecutive year amid a sharp increase in refinancings. Even with persistently high interest rates and rigorous underwriting standards, small multifamily entered the first quarter on steady footing.
Over the past 12 months, the leading rent growth markets spanned multiple regions, each exhibiting distinct strengths and characteristics.
Multifamily cap rates remain stable nationally, even as regional pricing diverged through the end of last year. While some regions saw compression and others late-stage repricing, regional cap rates show less variation as affordability-driven migration and capital reallocation compressed yield gaps.
The U.S. multifamily market finished 2025 with growing optimism and resilience. Investment volume accelerated to a three-year high, bolstered by greater interest rate clarity and the tightest cap rates across major real estate sectors.
The number of households renting single-family homes rose 1.7% in 2025, reaching a seven-year high, according to a new Arbor Realty Trust and Chandan Economics forecast, based on an analysis of newly released U.S. Census Bureau data. Since the pandemic, the single-family rental (SFR) sector has stabilized, reversing recent household losses and regaining momentum.
The latest report in Arbor Realty Trust’s Affordable Housing Trends series, developed in partnership with Chandan Economics, explores lingering challenges and new opportunities in this critically important multifamily real estate sector. In a new video, Dr. Sam Chandan, one of the commercial real estate industry’s leading scholars, shares his take on the new research report and what its findings could mean for the future of affordable housing finance.
With homebuying out of reach for many, more tenants are staying in the rental market longer than in previous cycles. This dynamic offers multifamily investors a strategic opportunity to focus on tenant retention, according to Dr. Sam Chandan, one of the commercial real estate industry’s leading scholars, who recently shared his expert insights on the 2026 Housing Outlook webinar with RentRedi.
Normalization was the thread that tied together multifamily real estate narratives in 2025. Asset valuations stabilized, cap rates held steady, and rent growth was balanced. Entering the new year, normalization is still driving the conversation, as shown by newly released data from the Federal Reserve Bank of Atlanta on real estate conditions and associated trends.
Solar panel installations, which skyrocketed in the U.S. over the last half-century, are projected to double to 10 million in just six years. While installations soared in all types of residences, owner-occupied properties significantly outpaced rentals. However, the evolving economics of solar power may be approaching a tipping point for single-family rental (SFR) operators looking for a differentiator.
Since the Fannie Mae Green Rewards program launched in 2015, green financing has become a mainstay of commercial real estate. In addition to reducing the environmental impact of multifamily housing, the Green Rewards program creates a triple bottom line with increased cash flows, higher quality housing, and lower energy and water usage. With a high upside and little downside, the program is well worth multifamily borrowers’ consideration.
Arbor is proud to have planted thousands of trees in the past 40 years – more than 13,000 in the past two years alone – and we’re still going strong. Since day one, Arbor’s focus on community-building, which grew from the forward-thinking vision of Founder, Chairman and CEO Ivan Kaufman, has defined the company’s direction and driven its philanthropic activities.