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The multifamily sector in 2025 is set for growth amid evolving economic and demographic trends. Here’s a concise look at the top trends shaping the market and how to capitalize on them.
1. Increase in Renter Demand
High homeownership costs and a housing shortage keep renters, especially Millennials and Gen Z, in apartments. Demand is expected to hit 400,000 units, with strong growth in Sun Belt markets like Phoenix and Atlanta.
2. Slower Construction and Rising Rents due to tariffs
New completions will drop to ~350,000 units, reducing vacancies to 4.9% and boosting rent growth to 2.6%, with markets like NYC exceeding 3%.
3. Sustainability are a Must-Have
Eco-friendly features like EV chargers and energy-efficient appliances attract tenants and cut costs by up to 20%.
4. Proptech Drives Efficiency
Smart home systems and AI analytics enhance tenant experience and streamline operations, reducing repair costs by up to 15%.
5. Build-to-Rent (BTR) Gains Traction
BTR communities appeal to families and remote workers in suburbs like Austin and Denver.
6. Community and Wellness Amenities
Coworking spaces, high-speed internet, and wellness features like yoga studios boost retention by up to 20%.
7. Economic and Policy Shifts
Stabilizing interest rates support $370–$380 billion in transactions, but inflation and policy changes may raise costs.