Rising Costs, Flat Rents: A Landlord’s Guide to Surviving 2026
If you’re like most landlords (myself included), 2025 was likely a difficult year. Rising costs, flat rents, and growing vacancies impacted the bottom line of a lot of mid-size multifamily properties. Here’s a quick look at where we are now and two key strategy suggestions as we move into 2026.
The past few years have been building toward what can only be called “the perfect storm” of 2025. In addition to rising insurance and utility costs, the easy availability of debt in 2020 and 2021 saw many new builds started during that time, and many of those projects were delivered in the last 2 years, with more on the way. Here’s a quick snapshot of local deliveries in the last 2 years, and a look at what’s coming in the next 2 years:
Everett: 366 new units delivered, with up to 900 more either expected or proposed
Lynnwood: 1,222 new units delivered, with up to 2,100 more either expected or proposed
Bothell/Kenmore: 667 new units delivered, with up to 600 more either expected or proposed
The other areas in our market tell a similar story. There has been a massive amount of supply brought to market in the last 2 years, and that trend will continue for the foreseeable future. Year over year rent growth has been flat in most areas of Snohomish and King Counties, and in some cases has decreased. Data suggests this trend will continue as well.
In a nutshell. Supply is growing to the point that it’s outpacing demand, and that means rents will likely stay flat or fall for the next couple of years.
So, what should you do with all this? Well, you’re probably expecting me to put my broker hat on and say “SELL!!!”, but that’s not what I’m going to do. Any sophisticated buyer knows all this as well, and knows that the multifamily market will likely be soft for the next couple of years. Those buyers will be active, but they’re going to want a deal.
If you find yourself in a position where you need to sell, let’s talk about how we can optimize your building and pricing to meet the demands of today’s buyers and price in a way that your property will move. If you don’t NEED to sell, I advise you don’t. Instead, I suggest these two simple but effective strategies as you move into 2026.
First - Be Content With What You’ve Got:
2026 is not the time to try and pursue rent increases. You’re competing with new units that offer a wide array of amenities. The best way that older units can compete with these shiny new buildings is price. Make every effort to keep your current tenants in place. Flat rent is better than high vacancy.
Second - Invest In Your Units
Many properties in these areas are already experiencing vacancy north of 10%. If that’s you, and you have the capital, this is a good time to freshen up your units to either attract new tenants or keep your current ones. Complacency will be a killer over the next couple of years, with tenants having so many more options to choose from, including many brand new buildings.
It’s not all doom and gloom. Looking ahead to 2028, supply is expected to level out, and most of Snohomish County should return to steady growth. That shift will bring demand back and likely push rents up again. For now, I suggest landlords stay the course, prioritize retention, and keep their eyes on the horizon.
