Multifamily has been needing some good news. Now, it has it. For the first time since the Fed began raising interest rates in early 2022, underwriting assumptions for prime multifamily assets are starting to stabilize, CBRE reports.
The average going-in cap rate increased by 23 basis points to 4.72% in the first quarter of this year, which follows increases of 39, 36 and 38 basis points in the three preceding quarters, according to CBRE.
The numbers mark the first significant quarterly decrease in cap rate expansion since the Fed initiated its latest round of rate hikes. In addition, the first quarter saw other metrics decelerate, including unlevered internal rate of return targets, exit cap rates and rent growth.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
