Accredited investors considering private-market real estate in 2026 should focus on multifamily properties, particularly given the potential for higher inflation and market volatility. The multifamily opportunity is best approached not as a broad endorsement of all apartments, but as a selective thesis capitalizing on significant dispersion across geographies, product types, and investment strategies.
One key factor is that elevated mortgage interest rates and other conditions have made renting a more realistic housing option for many. CBRE reports a substantial 105% monthly premium to buy over rent, indicating a continuously expanding renter pool. Simultaneously, the multifamily development cycle is moderating. The National Association of Home Builders (NAHB) projects multifamily starts to fall to 392,000 units in 2026 and 367,000 in 2027, following a 38-year high of 608,000 completions in 2024. This combination of factors supports a selective investment strategy: favoring markets with sustained positive rent growth, more controlled supply, and less exposure to competition from luxury lease-up properties.
Effective asking rents saw consecutive monthly gains in February 2026, according to RealPage, though regional performance varied considerably. The Midwest led with 2.0% annual rent growth that month, followed by the Northeast at 1.5%. In contrast, the South remained flat, and the West experienced a 1.4% decline. This pattern is consistent across all major data providers: rent growth in high-supply regions like the Sun Belt and Western markets is expected to lag pre-pandemic levels, while low-supply areas such as the Midwest and Northeast are poised for increases. Practically, the Midwest’s current advantage translates to reduced competitive pressure from new developments, fewer concessions, and a healthier equilibrium between demand and available supply. For investors, these conditions can lead to a more durable cash-flow profile compared to markets still absorbing an influx of new luxury products.
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