Bob FraserCFO & Macro Strategist | Data-Driven Investing Expert | Speaker & Author

Multifamily’s Secret Weapon? Single Family Homes

Name: Multifamily’s Secret Weapon? Single Family Homes
Uploaded: 2026-01-29T18:14:24+00:00
Duration: 2 min 16 s
Channel: Bob Fraser
Description: In this commentary, the speaker argues that the true housing shortage in the United States lies in single‑family homes, which make up roughly two‑thirds…

29 Jan 2026 · 2 min

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2:16

In this commentary, the speaker argues that the true housing shortage in the United States lies in single‑family homes, which make up roughly two‑thirds of the total housing stock. This shortage forces many households to remain renters longer, thereby supporting demand for multifamily apartments. The effect is amplified by the large number of homeowners who locked in historically low mortgage rates; as those rates stay fixed until a sale or death, the supply of affordable single‑family homes remains constrained. While some urban cores such as downtown Nashville and Denver exhibit tight multifamily markets, other areas are more balanced. The speaker emphasizes that leasing concessions (e.g., free rent months) are a temporary tool used when excess inventory exists, and they will disappear once occupancy improves even modestly (e.g., moving from 93% to 94%). He predicts that by the end of the year many markets will see concessions burn off rather than modest rent hikes, especially in suburban locations where new construction is limited.

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The real shortage is in single-family, which is two-thirds of all housing. That's where the real shortage is. That has helped the multifamily because people have to stay longer renting. And you take the shortage of housing and the super low interest rates people locked in, and the single-family is the best friend multifamily has, right? In a demand sense. That will continue because the shortage is not going to go away. And the interest rates being locked in go away every time somebody dies or every time somebody sells their home because they got a big promotion and they have to go, but it takes time. So it's really this, the single-family side, the multifamily, you can find pockets of tightness and you can find pockets of real looseness like downtown Nashville or downtown Denver, but there are also places that are in decent balance in multi. They're not wonderful. The thing I think people forget, and I've got a number of projects leasing up at this point, the thing I think people forget is concessions don't last forever. You only give away your product when there's a lot of product available. As soon as markets come back into any kind of balance, why would you give your product away? If you look historically, you go from giving away a month or two concession for 2 years, and then suddenly 7 months later, there are no concessions. Why? Because the space got filled. And we're only talking about a couple of percent, right? We're not talking about filling 30%. We're only talking about getting the market occupancy, let's say from 93% to 94%. That's enough to get rid of concessions. But as long as it stays at 93, you're gonna have concessions because that sloppiness is there. So I think by the end of this year, you're going to see a lot of concessions burning off in a lot of markets. And by the way, if you ask me which would I rather have, concessions burn off or 2% rent increase, I'll take concessions burning off. That's where you're going to see it happen faster. And I think you're going to see it in lots of suburban markets mid to late this year because there's not as much being built.