Apartment Concessions Decline, but Discounts Remain at 15-Year Highs

Landlords are handing out fewer rent breaks, but the ones that remain stay historically generous.

Nina Dale
October 22, 2026

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Apartment Concessions Decline, but Discounts Remain at 15-Year Highs

Good morning. Landlords are trimming who gets a rent break, not how big it is. Concession use fell to 14.5% of units in September, yet the average discount held near 11%.

🎙️ This Week on No Cap: Two multifamily operators on turnover costs, affordability, and whether this is a bubble.

CRE Trivia 🧠

Which Major League ballpark, opened April 20, 1912, is the oldest still in active use?

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Market Snapshot

S&P 500

GSPC

7,757.17

Pct Chg:
+0.58%

FTSE NAREIT

FNER

803.23

Pct Chg:
-0.94%

10Y Treasury

TNX

5.121%

Pct Chg:
+0.004%

CME Term SOFR

1-Month

3.93%

Pct Chg:
-0.00

*Data as of 10/21/2026 market close.

Multifamily

Apartment Concessions Decline, but Discounts Remain at 15-Year Highs

U.S. apartment operators are offering fewer rent concessions, but discounts remain historically generous, signaling a market that's improving but not quite out of the woods.

By the numbers: According to RealPage, concessions were offered on 14.5% of stabilized apartments in September 2026, down from 17% in May. However, average discounts held at 11.1%, equivalent to 5.8 weeks of free rent, the deepest incentives in over 15 years.

Across property classes: Concession usage declined across all classes, led by Class C, which fell 1.4 percentage points to 18.1%. Class B dropped to 13%, while Class A slipped to 12.5%. Studios remained the most heavily discounted, with 17.1% offering incentives averaging over six weeks of free rent.

A tale of two markets: Today's 11.1% average discount rivals the 11% offered after the GFC in 2010. The difference? Back then, 50% of apartments offered concessions, compared to just 14.5% today, suggesting operators are becoming more selective with incentives.

Fundamentals show resilience: National occupancy reached 95.2% in September, while same-store effective rents rose 1.5% annually. Apartment demand also slightly outpaced new supply, with 323,106 units absorbed compared to 317,966 completed.

➥ THE TAKEAWAY

Fewer freebies, stronger fundamentals: Apartment operators are gradually regaining pricing power, but generous incentives aren't disappearing overnight. With demand beginning to outpace supply, shrinking discounts could signal stronger rental income and a healthier multifamily market heading into 2027.

✍️ Editor’s Picks

Give every property a presence: RealtyAds Lite brings targeted advertising, a property website, and visitor insights together in a lower-cost package that keeps your asset visible to relevant audiences. (sponsored)
Sales slide: Pending home sales fell 7.3% in September as the 30-year mortgage rate jumped to 7.6%, with every region sliding as affordability tightened.
D.C. downgrade: D.C.’s multifamily market faces rising costs, regulatory hurdles, and declining investor confidence, with recovery hinging on reforms to restore profitability and attract capital.
Inside the search: A new white paper analyzes millions of Apartments.com AI conversations to reveal how renters describe their needs, weigh trade-offs, and think about affordability. (sponsored)
Supply squeeze: A shrinking construction pipeline could stretch rent growth for owners, with apartment starts down 50% from their 2023 peak and industrial underway off 60%.
Equity partner: UDR and Apollo are forming a $2B, 19-property venture at a roughly 6% implied cap rate, handing the REIT cheaper growth capital.
Core outlook: J.P. Morgan Asset Management projects 8.1% annual returns for US core real estate, trimmed slightly as higher rates weigh.

🏘️ Multifamily

Starts stall: Multifamily starts fell 25.9% YoY in September to a 349,000 pace even as permits rose 5.9%, with only the South posting an annual gain.
Watchlist builds: Servicers are watching $3.83B of Denver apartment debt, 13.6% of the metro's securitized balance, far above its 1.13% delinquency rate as income softens.
Permits diverge: U.S. housing starts fell 5.2% to 1.22M in September, while multifamily permits and completions rose, signaling localized strength despite broader construction weakness.
Renter priorities: Entrata’s survey found 62% of renters prefer a month of free rent over internet or streaming perks, highlighting affordability as owners navigate diverse renter demographics and financial pressures.

🏭 Industrial

Cold storage: A BGO and Banner venture bought a fully leased 160K SF Miami-area cold-storage building.
AI pivot: Big landlords keep leaning into AI, with Prologis committing $8B through 2029 to build 20 data centers, as warehouses turn digital.
Robotaxi reach: Amazon's Zoox keeps growing its Bay Area footprint, adding a 220K SF Hayward robotaxi plant, as AV makers soak up industrial space.
Neocloud jitters: CoreWeave's roughly $50B in debt and lease obligations has rattled markets, stoking fears about the neocloud firms bankrolling the AI data-center buildout.

🏬 Retail

Strip rebuild: Faring is pitching a 53K SF office-and-retail building on a shuttered Sunset Strip car dealership site, a rare new-office play on a boulevard now full of housing.
Sports lease: Brooklyn Powerhouse Sports leased 10,871 SF for batting cages at Sunset Park's century-old Whale Building.
Trader takeover: Trader Joe’s is expanding its nationwide footprint with 30 new stores planned across 16 states, including California, Texas, Illinois, and Ohio
Store push: Kroger is planning roughly 30% more store openings in 2026 while routing online orders through its existing stores, pairing growth with a leaner e-commerce setup.

🏢 Office

Pipeline props: The US office pipeline shrank to 32.2M SF, just 0.5% of stock, pulling national vacancy down 80 bps to 17.8% even as office-using jobs kept falling.
Leasing lags: US office leasing averaged 105M SF over the past four quarters, still about 10M SF shy of the 2015-19 norm, with San Francisco leading an uneven AI-fueled recovery.
Boca bet: Related Ross paid $64M for a 380,823 SF Boca Raton office complex, its second Boca purchase in two months as Stephen Ross builds a Palm Beach cluster.
Century strong: Celebrating 100 years, Williams Equities is capitalizing on Manhattan’s office market resurgence and growing tech demand in Midtown South.
Luxury tower: Houston developer Broadview is planning O27, a 32-story, 520K SF ultra-luxury office tower near the Galleria, though it has yet to lock in an equity partner.

🏨 Hospitality

Detroit gift: Dan Gilbert is pledging $1B to a nonprofit to remake Detroit's Renaissance Center and 35-acre riverfront, taking no profit and expecting no repayment.
Miami luxe: Luxury-led demand is powering Miami's hotel market, as high-end rooms outpace lower tiers.
2027 caution: Hotel leaders expect a soft 2027, with RevPAR projected up just 2.1% as costs outrun room rates and supply growth stays near 12-year lows.

📈 CHART OF THE DAY

While Fed data suggests wealth is declining among younger Americans, tracking the same individuals over time shows wealth is increasing across all age groups, including young adults.