Multifamily in 2026: Trends, Challenges & Predictions

Momentum in Q4

Multifamily activity accelerated in Q4.

Across the GTA we saw roughly $990M in multifamily deal volume, nearly three times the activity in Q3. Notably, there was a huge increase in buyer diversity with 29 distinct purchasers across 39 deals.

This activity came as a result of three factors:

1. Alignment

Early 2025 was still plagued by the expectations set during the pandemic. At that time, rates were near zero and owners across the board were bombarded with lofty unsolicited offers (some real, some not). It's taken time for the market to reset with the understanding that properties usually have to provide a return above a buyer's cost of capital.

Buyer demand remains strong with purchasers competing vigorously for deals, but now with an acknowledgment from vendors that rates are not going to zero again, and deals have to make some sense.

2. Financing Confidence

Financing is the backbone of Canadian multifamily.

While markets are never perfectly predictable, confidence in execution improved materially in Q4, particularly around bond market stability and CMHC timelines. We saw this firsthand.

In Q4 alone, our team closed four unrelated transactions where buyers had 10-day conditional periods and waived with confidence, including one firm deal with no conditions. While most buyers are still submitting with 30 to 45 days of due diligence, the willingness to move decisively is a clear signal, allowing more deals to successfully close.

3. Management Frustration

Managing multifamily is difficult. It's often a thankless job, especially for owners without scale.

Ongoing maintenance, tenant issues, regulatory complexity, and rising operating costs all require time and attention. Layer in a modest uptick in vacancies in certain pockets, and the work becomes even more intensive.

For some private owners, 2025 marked a turning point. Values had been maximized. The operational burden had increased. And the timing felt right to pass the asset to a new owner to steward the next chapter.

That dynamic quietly contributed to deal flow.

Trends, Challenges, and Opportunities Today

Rents are increasingly site-specific. Broad narratives matter less than building-by-building realities. Location, unit mix, and competitive supply are driving outcomes.

Bid depth is back. Buyer diversity has returned across private capital, institutions, and non-profits, reducing reliance on any single buyer cohort.

Cap rates appear stabilized. The cap rate expansion phase seems largely behind us. Pricing remains disciplined, but expectations are clearer on both sides.

Non-profit and government-backed capital is becoming more influential. This capital is patient, well-funded, and increasingly active, particularly for assets aligned with affordability mandates.

Real capital expenditure is being rewarded. Buildings where owners invested thoughtfully in suites and infrastructure are standing out. Underwriting is increasingly grounded in actual condition, not just upside in rents.

Certainty of execution matters more than ever. In today's market, a well-managed sale process and engagement with credible buyers are key to avoiding false starts and creating a successful result.

2026 Predictions

A few bold calls as we look ahead:

1. Higher transaction volume, potentially setting post-2022 records as alignment continues

2. Institutional capital returning in a more meaningful way

3. Non-profits continuing to be aggressive, particularly in urban cores

4. Increased attention on seniors housing from large players

5. A rebound in the Canadian narrative, driven by capital inflows and long-term fundamentals

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