by David Nelson

2023 has been a challenging year for multifamily real estate. But make no mistake: investing in multifamily properties can still be a powerful vehicle for building wealth.

In the midst of economic uncertainty and a slew of new apartment homes coming online, rent growth has softened. Nationally, rents increased by only 0.1% on an annual basis in October, according to RealPage.

Rising interest rates, the increased cost of capital and the gap between buyers’ and sellers’ expectations have stalled multifamily transactions. In the third quarter, multifamily investment sales totaled $30.1 billion, representing a nearly 62% decrease from the same period in 2022, according to a report by Newmark Group.

Read David Nelson’s article in Wealth Management’s 2024 Market Outlook.