Houston Multifamily Momentum Carries into 2026
- RAI Commercial Group
- 3 days ago
- 2 min read
By RAI Commercial Group, powered by Coldwell Banker Commercial Universal
The recent CoStar report highlights meaningful momentum in the Houston multifamily investment market, with activity in 2025 building on the recovery that began in late 2024. The report makes several important observations that align with what we are seeing on the ground, and it also points to strategic themes that investors should track as the year unfolds.
First, while quarterly dollar volume remains uneven due to the sporadic timing of large trades, the transaction count itself has emerged as a more reliable indicator of market health. Notably, the fourth quarter of 2025 posted a four-year high in quarterly transactions, signaling renewed confidence among buyers and sellers.
The narrowing of bid-ask spreads, combined with plentiful debt capital and improving leverage terms, is helping to unlock activity that was paused or constrained over the past two years. Lenders are now more active across the capital stack, with GSEs maintaining significant market share even as debt funds and life companies increase participation.
One of the most compelling takeaways from the report is the return of institutional capital. Institutions accounted for nearly one-third of buyer activity in 2025, up from 25 percent in 2024 and approaching the pre-pandemic range of 35 percent. This shift underscores growing confidence in Houston's fundamentals.
Drivers cited in the CoStar article resonate with what we hear from investors and owners locally:
Robust population growth underpins long-term demand.
Diversification of the local economy continues to strengthen occupational absorptive capacity.
Workforce housing remains undersupplied, especially given recent pullbacks in new construction.
Stable cash flows from well-leased assets support renovation and value-add strategies.
The December transactions highlighted by CoStar illustrate these dynamics in practice. Institutional and private capital targeted older but well-leased assets with the potential for performance enhancement through active management and physical upgrades. Properties such as Fox Hall Apartments and Sage Hollow reflect this focus on quality, occupancy, and positioning.
The continued preference for debt assumptions, typified by Palatine Capital Partners’ acquisition of Villages at Parktown, further reflects how thoughtful capital structuring remains a competitive advantage given current Treasury yields and Fed rate dynamics.
In sum, the CoStar article reinforces the narrative that the Houston multifamily market is entering a phase of strategic expansion rather than short-term repricing. With capital conditions improving, institutional and private buyers actively deploying, and fundamentals grounded in strong demographics and economic growth, we expect the market’s positive trajectory to persist through 2026.
Invest Smarter with RAI Commercial Group
CoStar’s findings confirm what we see daily: Houston’s multifamily market has shifted from uncertainty to strategy. Capital is returning, spreads are tightening, and well-leased assets are back in focus.
At RAI Commercial Group, we help investors read these signals early and act with precision. Backed by Coldwell Banker Commercial Universal, our team translates market momentum into portfolio growth and smarter acquisition strategy.
2025 rebuilt confidence. 2026 will reward clarity. Let’s position your next move.
Book a strategy call today and learn how we can help align your portfolio with the next wave of Texas growth.
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Written by RAI Commercial Group
Powered by Coldwell Banker Commercial Universal
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