Consistent increases in insurance premiums have put downward pressure on multifamily property values, particularly in the nation's Sunbelt markets. Nationwide, multifamily property values have dropped 3.6% since the end of 2019 due to rising insurance costs, according to CBRE.

Houston was the hardest-hit market in the south-central region, with values dropping 11.1%, while Oklahoma City was least impacted within the region, as property values fell 3.8%. In Florida, where premiums have more than doubled over the past two years, Jacksonville saw property values drop 9.6%, while West Palm Beach multifamily property values fell only 5% in comparison. However, the report noted that while the South Florida multifamily market had some of the most substantial increases in insurance premiums, the impact on property values was offset by resilient renter demand and unprecedented rent growth in 2021 and 2022.

The same is true in California, where wildfires and other environmental factors have inflated insurance costs, but higher rents have offset the negative effects.