Multifamily real estate investment trusts (REITs) closed the third quarter navigating a muddled economic landscape—marked by slower job growth, softening household formation, and the weight of record new supply—yet still managed to post steady results and strong resident resilience. Executives pointed to soft but stable fundamentals seen this year and a growing confidence that sharply lower supply in 2026 will shift momentum.
“Most of our markets face some combination of employment uncertainty, slower household formation, lower consumer confidence, and high levels of recently completed supply,” said Tom Toomey, chairman and CEO of UDR, during the third-quarter earnings call. “Collectively, these factors have contributed to rent growth that has been more measured than what we anticipated as recently as 45 days ago. Even with this backdrop, we are encouraged by various indicators that suggest our residents are resilient and appreciative of the value of renting at UDR.”
Mark Parrell, president and CEO of Equity Residential, shared similar sentiments, saying the REIT reported its highest third-quarter resident retention in the company’s history, allowing it to maintain high occupancy rates in the mid-96% range.
“Despite what is generally a mixed macroeconomic picture, we continue to see good demand and excellent resident retention across most of our markets, with results strongest in San Francisco and New York, where continuing high demand has meant modest supply,” he noted. “Strong apartment demand continued through the third quarter, making 2025 one of the best in the last 25 years for apartment absorption, helping to fill up the record number of recent deliveries. … Apartment affordability improved during the quarter with 33 months of wage growth exceeding rent growth, and increased affordability improves apartment residents’ ability to absorb higher rents when new apartment deliveries are leased up in 2026 and beyond.”
For MAA, headquartered in Memphis, Tennessee, and operating in the Sun Belt, president and CEO Brad Hill also noted the importance of resident retention and decelerating supply.
“Resident retention remains strong with turnover at a record low,” he said. “Solid demand coupled with meaningfully lower levels of new deliveries and our strong occupancy position MAA well to capitalize on the coming year and what we expect will be an acceleration of the recovery cycle.”
In other third-quarter REIT news, the board of trustees at Elme Communities announced that it approved a plan for the dissolution and liquidation of the company. In mid-November, Elme finalized the $1.6 billion transaction of 19 multifamily communities with nearly 6,000 units to Cortland.
Quarterly Results
AvalonBay reported core funds from operations (FFO) per share of $2.75 in the third quarter, a 0.4% increase from the same period in 2024. Third-quarter same-store revenue and net operating income (NOI) increased 2.3% and 1.1% year over year, respectively.
Camden Property Trust posted core FFO per share of $1.70 in the third quarter, $0.01 below its results in the same period in 2024. Same-store revenue for the REIT grew 0.8% year over year, and same-store NOI remained flat.
Elme Communities posted core FFO per share of $0.22 in the third quarter, a decrease of $0.01 compared with the third quarter of 2024. Multifamily same-store NOI decreased 1.8% compared with the prior-year quarter.
In the third quarter, Equity Residential’s FFO per share was $1.05, 6.1% higher than a year ago. Same-store revenue increased 3%, while same-store NOI increased 2.8% compared with the third quarter of 2024.
At Essex Property Trust, core FFO per share increased 1.5% year over year to $3.97 in the third quarter. The REIT achieved same-store revenue and NOI growth of 2.7% and 2.4%, respectively, compared with the third quarter of 2024.
At MAA, third-quarter core FFO per share decreased $0.05 on a year-over-year basis to $2.16. Same-store revenues decreased 0.3% compared with the third quarter of 2024, while same-store NOI decreased by 1.8% in the same period.
UDR reported FFO per share of $0.62, up $0.02 from the same period a year ago. Same-store revenue and NOI grew 2.6% and 2.3%, respectively.
Veris Residential posted core FFO per share of $0.20 in the third quarter, an increase of $0.03 compared with the third quarter of 2024. Same-store NOI increased 1.6% compared with the prior-year quarter.
Management Commentary and Outlook
“As we start thinking ahead to 2026, while job growth has been below expectations recently, our portfolio is positioned to perform relatively well given two important factors: First, the very low level of new supply expected in our regions; and second, a lack of affordable for-sale alternatives. New supply in our established regions is expected to decline to roughly 80 basis points of existing stock in 2026, which is not only less than half the trailing 10-year average, but also a level we haven’t experienced since 2012. It’s also roughly consistent with what occurred during the ’90s decade, which was a terrific time period for us.”—Sean Breslin, chief operating officer, AvalonBay Communities
“There should be less uncertainty in 2026. And the uncertainty that we have today, we know that tax reform is off the table, we know inflation is coming down, we know that the Federal Reserve’s lowering rates, and we know that there’s a midterm election coming, which means that the administration is going to do whatever they can to make sure the economy is good in November 2026. The big tariff debates will likely be less of a debate during that period for all the obvious political reasons. And we have a 25% reduction in new deliveries in Camden’s markets. With all that said, generally speaking, when you have a midterm election in this environment, unless something really comes off the rails, it should be a reasonable environment to improve demand and to create more optimistic scenario in 2026.”—Richard Campo, chairman and CEO, Camden Property Trust
“Our third-quarter operational performance aligned with our expectations and was consistent with typical seasonal patterns across our portfolio. Our performance highlights not only the overall stability and quality of our portfolio but also the results of executing our operational platform initiatives and the effectiveness of our team’s efforts as we continue our focus on maximizing value for shareholders.”—Paul T. McDermott, president and CEO, Elme Communities
“I want to reiterate how excited we are about the forward prospects for our business. Our internal tracking shows deliveries of competitive new supply in our markets, declining 35% or by about 40,000 units in 2026 versus 2025 levels. The results we are seeing in San Francisco and New York demonstrate the earnings growth power of our business when we are operating in markets with sustained demand and low levels of competitive new housing supply. We believe more markets we operate in will trend in that direction in 2026, assuming the job situation is reasonably constructive.”—Mark Parrell, president and CEO, Equity Residential
“Given the soft economic environment and policy uncertainty, we are not surprised the hiring and investment decisions have been delayed across the U.S. But we are pleased to see the West Coast once again outperforming the U.S. average, a trend we anticipate continuing. Looking to 2026, our portfolio is well positioned relative to other U.S. markets, supported by lower levels of housing supply, attractive affordability, and demand catalysts from the technology sector.”—Angela Kleiman, president and CEO, Essex Property Trust
“Our focus on high-demand, high-growth markets, significant redevelopment opportunities, efficiency gains from technology initiatives rolling out in ’26 and beyond and a growing external growth strategy position us for stronger earnings growth. Our portfolio will continue to benefit from job growth, wage growth, household formation, and migration and population trends that outpace other regions. We are encouraged by the building blocks that are in place in what we expect will be an acceleration of the recovery cycle in 2026 leading to sustained revenue and earnings growth, as new deliveries continue to decline and the recovery advances.”—Brad Hill, president and CEO, MAA
“From a long-term perspective, the United States remains structurally underhoused. Affordability of renting an apartment relative to home ownership is nearly at an all-time level of favorability. And the pipeline for future supply has materially decreased. UDR is cycle-tested, having delivered more than 10% average annual total shareholder return over the past 25 years.”—Tom Toomey, chairman and CEO of UDR
“The third quarter marked another period of significant progress advancing Veris Residential's corporate plan, as we seek to continue accelerating our balance sheet transformation while delivering outsized earnings growth. With $542 million in non-core asset sales either closed or under contract year to date—exceeding our target for non-strategic asset sales—we are pleased to raise our disposition target to $650 million, positioning us to potentially delever to below 8x by year-end 2026.”—Mahbod Nia, CEO, Veris Residential