The following article summarizes some of the key takeaways from the National Multifamily Housing Council’s (NMHC) January 22, 2026 webinar. The discussion featured NMHC Chief Economist Chris Bruen and Ivy Zelman of Zelman, a Walker & Dunlop Company. The summary below reflects remarks made during that webinar and is provided for informational purposes.
While equity and debt financing are improving, sales volume and market conditions have worsened slightly, according to the Q1 2026 State of the Multifamily Market Survey results presented by the NMHC.
“For the second consecutive quarter, our member responses to our quarterly survey indicated they’re seeing looser market conditions,” said Chris Bruen, senior director of research and chief economist for NHMC. The overall score for market tightness was 32, with a score below 50 indicating worsening conditions. The sales volume index also dropped to 47 from 59 in October, indicating a slowdown in deal flow, although 63% of those surveyed said sales volume was unchanged compared to the previous quarter.
However, financing conditions were a bright spot.
“For the fourth consecutive quarter, debt financing showed improvement over the previous quarter,” Bruen said. This quarter, the debt financing index remained high at 75. In addition, the equity financing index reached 53, the second consecutive quarter of equity financing becoming more available.
Bifurcated Multifamily Market
While asking rents were down year-over-year nationally in January, rent declines are primarily in Sunbelt markets, according to Ivy Zelman, executive vice president, research and securities for Zelman, a Walker & Dunlop Company, Bruen’s webinar guest.
“During Covid and after Covid, there was outsize rent growth in the Sunbelt because of increased migration there,” Zelman said. “Developers for both multifamily rentals and for sale properties followed that migration pattern, with the result that there’s too much inventory for multifamily properties, single-family built-to-rent properties and new single-family homes.”
That’s led to market bifurcation, with Sunbelt occupancy rates and rents dropping, while the Midwest and Northeast, which didn’t see as much development, continue to see rents accelerate, according to Zelman.
“Interestingly, even though this means there’s more affordability on the for sale side in the Sunbelt because of higher inventory, consumers are hesitant to buy,” Zelman said. “They lack confidence and have trouble qualifying for a loan.”
Buy vs. Rent Premium at Record High
In January, the premium additional cost to buy vs. rent reached a record high level, according to NMHC research.
“Rents are under pressure right now, so renting is far better from a strictly math perspective,” Zelman said.
Zelman predicts 1.9% rent growth in 2026 nationally, but it would be higher if not for the slowdown in the Sunbelt. Lease ups were at high levels nationally until the fourth quarter of 2025, but with employment growth slowing, there’s a potential demand slowdown ahead, she said.
Transactions and Development
On the supply side, Zelman said that about 350,000 to 400,000 units are in the construction pipeline now, which is consistent with average years.
“The question is whether these projects are being underwritten at future rent predictions or current rents,” Zelman said. “There’s been some hesitation, but starts are still happening, just not at the level they were a few years ago.”
Multifamily sales volume is down a little from historic highs, according to Zelman.
“Deals are getting done, just not at the high levels of the past,” she said. “There’s more hesitation about transactions on the buyers’ side, and sellers want to wait for higher prices if they can.”
The concerns, she said, are the potential for a weaker economic future, particularly in the job market, and the potential for rents to decelerate in some housing markets.
However, Zelman said her research concurs with the NMHC survey results, that debt and equity financing is available.
“There’s plenty of private equity money from investors ready to put their money to work to lend or buy,” she said. “They’re looking for a return on their investment, but they’ve lowered their expectations a little bit.”
One aspect that may help on the financing side is that owners have been able to drive costs down through operational efficiencies, Zelman said. In addition, because construction is down, labor is plentiful and material cost inflation has been relatively benign recently, according to Zelman.
“The biggest impediment to builders is interest rates and the cost to borrow, rather than labor and material costs,” she said.
Housing Shortages and Solutions
As Congress and the Trump administration propose solutions to improve the housing shortage, Zelman said that the biggest issue isn’t simply a shortage of units – it’s affordable units.
“There’s pent-up demand among 25 to 35-year-olds who haven’t formed their own households because they can’t afford to rent an apartment or buy a house,” Zelman said.
She suggests that eliminating or lowering the capital gains tax for existing homeowners – including “Mom & Pop” investors – could help increase supply without flooding the market with so many new homes that values decline.
“For developers, the biggest obstacles to building are lot costs and impact fees, which are imposed at the state or local level,” Zelman said. “If I were in charge, I would demand that governors lower or eliminate impact fees.”
Addressing those costs, as well as concerns about rent control, could result in more development at a more attainable rent, she said.
Zelman recommends developers turn their attention to the Midwest, particularly if the promised reshoring of jobs occurs.
“The Midwest has land for data centers and manufacturing sites that doesn’t exist in coastal areas, plus I believe we’ll see more people migrating back to the center of the country for affordability,” Zelman said.
Zelman is cautiously optimistic that 2026 will be a little better economically than 2025, with a sense that it will somewhat stable.
“Multifamily real estate is still the best asset class for investors, with rental cash flow income and renter demand continuity,” Zelman said. “Investors just need to adjust their expectations that they may not get double digit returns right now.”
This material is provided for informational purposes only and is a summary of remarks made by third parties during a public webinar. The views expressed are those of the speakers and do not necessarily reflect the views of Greystone. The information provided in this article, including, without limitation, any opinions, predictions, forecasts, commentaries or suggestions, should not be construed as investment, financial, legal, tax or other advice. Any forward-looking statements and economic forecasts are inherently uncertain, and actual results may differ materially.