NEW YORK CITY—Even as multifamily remains the strongest commercial property sector by a variety of metrics, including investment sales volume, analysts are expecting deceleration in rent growth and, with that, in revenue growth as well. At Reis Inc., for example, chief economist Victor Calanog sums up a 10-basis point third-quarter uptick in nationwide vacancies and “paltry” asking and effective rent growth of 1% and 0.9%, respectively, by reiterating what he'd said in August: “expect a moderation in rent growth” as the market absorbs new supply.

Similarly, although Fitch Ratings notes that the apartment market remains strong and that “demographics continue to favor the multifamily sector,” the ratings agency sees a peak approaching. Accordingly, Fitch says it expects to cap revenues for this year at 2016 levels.

Partly that's due to a continued robust delivery pipeline, which Fitch links to an expected uptick in vacancies. Citing Reis data, Fitch notes that 258,000 apartment unit are expected to come on line by the end of this year. “That's a number that we haven't seen at the national level since the late 1980s,” Calanog writes.