The U.S. multifamily market has been on an occupancy roller coaster during the past several years. As new construction starts have plummeted and occupancies have stabilized, investors have returned seeking net operating income (NOI) growth, in the belief that we are at the bottom of the cycle. Nationally, demand has been stronger than historical averages, with several markets posting record absorption in the first six months of 2025.
Investors should prioritize U.S. multifamily markets given the varying drivers of market recovery and subsequent expected NOI growth — the decline in concessions, typically free rent, occupancy gains and rent growth.
Incentive swings
Concessions increase when vacancies rise, especially in markets with new construction deliveries. These concessions help attract new tenants while also allowing building managers to maintain face rent on renewals and shape tenant perceptions of prevailing market rents, which helps pre
