From California to Maui, the frequency and scope of wildfire events are rising, causing insurance markets and public agencies to reevaluate property in areas at risk for catastrophic damage. As a result, rental housing providers are seeing greater limitations to coverage, higher premium prices, and, in some cases, a total absence of viable private insurance — a trend detailed in the NMHC 2023 State of Multifamily Risk Survey and Report. This troubling new trend has placed many rental housing operators in a bind where they must simultaneously contend with the declining availability and affordability of insurance options.

Reliability of Small Multifamily Tenant Base Fuels Recovery
Our quarterly report on the current and emerging small multifamily investment trends features data and research from Chandan Economics. The report reviews the state of the market, identifying trends in underwriting, financing, cap rates, valuation and more. In the report, you’ll learn how small multifamily properties differ from larger properties, and the forces driving their investment performance.
Key Findings:
- An analysis of work from home trends finds that small multifamily properties may be less affected than larger properties because fewer tenants can work remotely.
- Small multifamily cap rates held at 5.2% in the third quarter, effectively unchanged from last quarter.
- The refinancing share of originations rose as investors locked in rates ahead of potential monetary tightening and expected rate rise.
- Asset prices rose 2.9% from a year earlier and 7.7% over pre-pandemic highs.
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