Examining Multifamily Markets Above, Near, and Below Historical Trends

Key Points

• Multifamily market momentum nationally has normalized and is tracking close to long run historical averages.
• Several markets highlighted in Arbor’s latest Top Markets for Multifamily Investment Report are also outperforming their own historical benchmarks.
• Midwest metros and select Sun Belt markets continue to post above average momentum, while a smaller group remains below trend.
• Market level data from multiple sources reinforces a consistent stabilization narrative entering 2026.

Following a lengthy period of volatility, multifamily fundamentals entered 2026 largely in balance. Recent research published by Arbor Realty Trust shows that while national-level performance is falling in line with long-run historical norms, outperforming markets, full of investment opportunities, are emerging.

What the Data Shows

At the national level, multifamily market momentum has stabilized near its historical average. Through the third quarter of 2025, the Federal Reserve Bank of Atlanta’s Commercial Real Estate Market Index (CREMI) reading for multifamily hovered around zero, indicating that performance is neither meaningfully above nor below long-term trends. This shift reflects the unwinding of the pandemic-era surge and subsequent pullback, underscoring the sector’s underlying durability as it enters a more sustainable phase of the cycle.

Markets Performing Above Historical Trends

There were, however, individual markets that stood out among the 50 largest U.S. metros. Nashville and Salt Lake City posted CREMI readings more than two standard deviations above their historical averages, placing them firmly in above-trend territory. These same markets ranked highly in Arbor’s Top Markets for Multifamily Investment Report Fall 2025, supported by strong population inflows, diversified employment bases, and relatively disciplined new supply pipelines.

Midwest metros also feature prominently among the outperformers. Markets such as Milwaukee and Pittsburgh registered above-average momentum, reinforcing that affordability, stable job growth, and balanced development activity continue to support durable multifamily performance across the region.

Markets Near Long Run Averages

A large share of major U.S. metros now sit close to their historical averages. These markets reflect the broader normalization theme, where rent growth has moderated, development pipelines are being absorbed more evenly, and operating performance has stabilized. For investors, these conditions favor selectivity and asset-level execution rather than reliance on broad market appreciation.

Markets Below Historical Trends

A smaller subset of markets remains below long-run averages. Denver, San Antonio, and Portland, OR. each posted CREMI readings roughly two standard deviations below their historical norms. In these metros, elevated development pipelines combined with higher financing costs and softer demand growth have weighed on momentum. Importantly, these trends reflect localized supply-and-demand dynamics rather than systemic weakness across the multifamily sector.

The Takeaway

Viewed together, Arbor and the Atlanta Fed’s data paint a fuller picture. Multifamily fundamentals have stabilized nationally, with performance returning to historical norms, while select markets such as Nashville and several Midwest metros continue to outperform. Investment outcomes in 2026 will increasingly be shaped by local supply discipline, demographic trends, and employment composition rather than national cycles.

For continued insights on multifamily markets and investment strategy, visit Arbor.com and Traded.co.