Shafiq Hirani CCIMReal Estate Advisor, REMAX Distinctive · Real Estate Advisor at RE/MAX Distinctive Commercial | Washington, DC | Your Guide To Profitable Real Estate Ventures

Insurance Costs SOARING! Is Your NOI CRASHING? #shorts

19 Aug 2026 · 2 min

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In this concise market commentary, Shafiq Hirani CCIM warns multifamily property owners that rising operating expenses—especially landlord insurance premiums—are eroding net operating income (NOI). Citing RealPage data, he notes a 119% increase in insurance costs over four years, with operators budgeting an extra $275‑$356 per unit and Houston premiums exceeding $1,200 per unit. Insurance’s share of revenue has risen from under 2% in 2000 to nearly 5% today. He also highlights national property tax hikes of over 23% (2019‑2023) and a 28% rise in repairs & maintenance since 2021. Industry guidance suggests budgeting a 15% insurance increase even without claims. Hirani illustrates the “squeeze”: if rent growth stays around 2% while expenses climb 8%, NOI will stagnate or shrink despite full occupancy. He concludes that for the remainder of the year, controlling expenses is the primary lever to protect NOI, as revenue growth is market‑limited.

Chapters

That is the squeeze, and it is happening quietly on thousands of buildings right now. And now the number that matters most, because this is where the second half of the year will be won or lost for most owners. Your expenses are not growing at 2%. Landlord insurance premiums are up 119% over 4 years, according to RealPage. Operators are budgeting $275 to $356 more per unit this year, Just for insurance. In Houston, insurance now exceeds $1,200 per unit. Insurance was under 2% of multifamily revenue in the year 2000. Today, it is nearly 5%. Property taxes rose more than 23% nationally between 2019 and 2023. Repairs and maintenance are up more than 28% since 2021. Industry guidance for this year is to budget a 15% increase in insurance premiums, even with no claims history. Now do the math on your own building. If revenue grows 2% and expenses grow 8%, your NOI does not grow. It shrinks. Even at full occupancy. That is the squeeze, and it is happening quietly on thousands of buildings right now. Rent growth stays near 2%. And expenses keep climbing faster than rents, which means for the rest of this year, the expense side of your income statement is where your NOI lives. The revenue side is capped by the market. The expense side is capped only by how carefully you manage it.