In this video, Jonathan Cronin, a multifamily investor who has helped build a $550 million real‑estate portfolio, presents a data‑driven briefing on the five U.S. markets he advises investors to avoid in 2026. He details the specific distress signals for each city—Austin (TX) suffers from massive oversupply and a 17% rent drop since 2022, Phoenix (AZ) faces 21,000 new units in 2025, 12.5% vacancy and rent concessions, San Francisco (CA) is plagued by population loss and stringent rent‑control regulations, Jacksonville (FL) combines high vacancy (12.2%) with insurance premiums more than double the national average, and Nashville (TN) is over‑built with 4‑5% new inventory and soft rent growth. Cronin then shifts to strategy, explaining how disciplined underwriting, rapid deal‑flow generation, and a supportive community of seasoned investors can uncover discounted opportunities even in these “bad” markets. He shares recent deal examples—a 90‑unit complex bought $6 million below seller’s basis and a $7.2 million property with a $14 million seller valuation—to illustrate the “price‑the‑deal” concept. Finally, he promotes his faith‑based investor group, offering mentorship, deal sourcing, and underwriting support for those ready to act within the next 6‑9 months.
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There are 5 markets in multifamily that according to the data, investors should run from at all costs. So in this video, we're going to evaluate every single one of those bad markets, show you the exact numbers. Okay, my name is Jonathan Cronin. My partners and I have built over $550 million in real estate portfolio, and these are the facts and data in today's market. So let's get into it. Austin, Texas being number 1. Austin was the darling of multifamily investing for years. All right, strong tech jobs. Inmigration, a growing population, developers saw the opportunity and basically went all in on Austin. Between 2019 and 2022, Austin was permitting over 20,000 units a year. All right. Those projects all came online at roughly the exact same time and the market got flooded, right? So here's what that looks like in real numbers. According to Apartment List CoStar data, rents dropped from a peak of $1,726 a month in rent in August of 2022 to $1,425 today. That's a 17% decline in under 3 years. CoStar tracked that 65% of apartment complexes in Austin are currently offering some kind of concession just to find tenants. 2 months free, 3 months free, crazy concessions. And CoStar isn't just expecting meaningful rent recovery until 2027. For the average investor buying at market price with no advantage, this is a war of attrition. All right, the word average is doing a lot of work here, so we'll come back to that in just a second. But Phoenix, Arizona, Boom, same story, different city. Okay, according to January 2026 multifamily market report, Phoenix delivered 21,000 new units in 2025 alone. Okay, pushing vacancy to 12.5% in early 2026 with another 19,000 units still under construction. All right, competition remains intense. That excess supply drove asking rents down 3% across the market. And according to, uh, Matthews Real Estate, over 50% of communities are offering concessions 6 to 8 weeks of free rent just to fill the units. All right. So obviously demand is there. Phoenix is still growing, but developers have overbuilt into that demand. And now most of the operators are paying the price, right? Because rent growth is expected to stay negative throughout 2026. If you don't know how to find deals with built-in margin before you actually close, this market will absolutely destroy you. It'll punish you right now. Number 3, San Francisco, California. This is a different kind of problem right here. Okay. It's not oversupply. Right? It's people leaving, people getting out of San Francisco, right? San Francisco has been losing population for years. The regulatory environments makes it one of the hardest markets in the country to operate in. Okay? Eviction controls, rent stabilization ordinances, permitting nightmares. And unlike Austin or Phoenix, this doesn't resolve when the construction pipeline clears, right? So the headwinds are structural. Most investors have no business being in that market in San Francisco, but Most investors also don't know what to look for when a market is distressed. So we're gonna talk about that in just a second. But Jacksonville, Florida, number 4, Jacksonville. I love Florida, but Jacksonville gets overlooked so many times in this conversation. According to the Q3 2025 Matthews Market Report, multifamily vacancy in Jacksonville has hit 12.2%. All right, making it the hardest hit major Florida metro in the current oversupply cycle. All right. With basically they have flat to negative rent growth for 10 consecutive quarters. But here's what makes Jacksonville particularly brutal. It's not just oversupply, it's the operating cost. According to the 2026 Florida Rental Market Analysis, landlord insurance premiums in Florida right now have an average of $5,376 per year for $300,000 in coverage. All right. It's more than double the national average, which is $2,181. Hurricane exposure, litigation costs, reinsurance spikes. Like, it's almost impossible to make it work with the insurance right now. The cost to operate in the state, in Florida, has fundamentally changed. For an investor who doesn't know how to underwrite, these costs can just ruin it, right? Can ruin the opportunity. You've got to underwrite from day one correctly. This market can be a trap. So you gotta be careful. Nashville, Tennessee, number 5. Nashville was hot, and that's exactly why it's on this list. All right, according to PwC's Emergency Trends in Real Estate, Nashville is among the markets where 4 to 5% will still be added to existing inventory in 2026 and 2027. All right, even as, as the broader national pipeline is pulling back, the market basically got overbuilt at the peak and it's still working through that supply. So rent growth is soft, vacancy is elevated. Nashville, Tennessee is not where you want to be. So what do you do? Where should you be buying? Is your city not the place to be? Here's what you need to know. Everything I just showed you, the vacancy rates, the rent drops, the insurance costs. Most investors are getting cooked if they are buying at just whatever price the seller's asking, or even some undersellers asking, they're still getting cooked. But there's another investor in that same market, same city, same zip code, same data, and they're cash flowing and they're gonna be creating millions of dollars in equity. We just bought a 90-unit apartment complex. We, we're in for $6 million less than what the the seller has in it. How is this happening? I always say every deal has a number. I don't advise investing in a market that is declining in population, but there is a price that makes the deal work regardless of what the market is doing around that deal. May sound wild, but in a good market, that number may be higher. In a bad market, that number is going to be lower. They may even need to pay me to take that deal over, but it exists everywhere. Most investors never find the deal because they are focused on the market. Okay, so our clients, people we help are focused on 3 things, really. Volumes, number 1, and enough deal flow that you're surfacing motivated sellers who are willing to meet you at a discount. All right. The deal that works is buried inside 50 that don't. All right. You need a machine that finds them and can find the best deals. Like I said, we just got a deal for $7.2 million. The seller, the owner literally has $14 million in that property. And those opportunities are out there. You just have to know how to attract those, those potential deals. Underwriting. So when the deal comes through, you know, in minutes whether the numbers work, not weeks, minutes, because the investors who move fast are the ones who close. All right. And you need a community. You need people that have thousands of doors under their belt that are instructing you. You need to surround yourself with people that have already made the mistakes, that have already invested in there. They own deals in that market and have been doing this for over 2 decades or more, right? People who are experienced across many market cycles, okay? Because there's a lot of them that happened over the past 10, 20, 30 years. So that way you're never looking at a deal alone, right? And here's the thing, if you're sitting in a city right now thinking there's no deals here, I hear this all the time, there's no deals here, they're all overpriced. That's exactly where we come in, right? We have helped investors find deals in markets they were ready to give up on, all right? Because the deals are there. You just need the right system to find the deals. We're evaluating one deal for, it's 40 units in Atlanta. It's $7, $8 million. Another deal in Birmingham, same day, 100 units for $4 or $5 million, right? It's not about the number, it's about the opportunity. There will always be a reason to not invest, right? And someone will always have a list of reasons why now is the wrong time. But the investors who build generational wealth don't wait for the perfect market. They develop the skill to find the number in any market, invest When blood is in the streets. Somebody said that. Invest when blood is in the streets, right? So look, if you enjoy this video, we're a group of faith-based investors doing deals across every city in the United States because we believe opportunity is not just limited to zip codes, right? God puts opportunities in front of people who are prepared to receive it, right? The question is never whether the deal exists. The question is whether you're ready when it shows up. All right. So look, if you want help closing your first or next apartment building in the next 6 to 9 months, if you're serious about getting in this game, protecting your downside, increasing the upside. Click the link below. I'll put it in the description and, uh, we'd love to jump on a call. All right. God bless.
