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.
The single-family rental (SFR) sector, supported by healthy fundamentals, demonstrated its strength and durability again last quarter as the for-sale home market softened.
Arbor Realty Trust recently wrapped up its 18th Annual Holiday Drive, which raised nearly $22,000 for Long Island-based Family & Children’s Association (FCA). As in past years, Arbor extended the impact of the drive by matching all employee contributions dollar-for-dollar.
The multifamily rental households estimate reached an all-time high of 22.4 million in 2025, following meaningful post-pandemic shifts in affordable housing and rental demand. The commercial real estate pillar maintained its growth, as new inventory and persistent homeownership constraints supported a rising number of multifamily household formations.
While the impact of COVID-19 contributed to a 0.9% decline in small multifamily prices in the first quarter of 2020, they are still up 5.5% from a year ago.
Chandan Economics’ analysis noted that annualized first-quarter small multifamily loan value fell to $55.2 billion, representing a 6.7% decline in lending activity compared to last year. Yet the report provides reasons for reassurance. The dependability of underlying multifamily demand and the agencies’ commitment to providing programs that maintain market liquidity support the sector’s traditional resiliency. Even with the uncertainties caused by the coronavirus, multifamily is expected to outperform other sectors.
Download the full report, “Q1 2020 Small Multifamily Investment Trends Report,” for the latest updates covering the following:
