Even as apartment market conditions continue to ease nationwide—marked by slowing rent growth, rising vacancies and a pullback in deal activity—rent control remains a significant deterrent to apartment investment and development, according to a new survey by NMHC.
The survey found that 35% of respondents have cut back on investment or development in rent-regulated markets, 41% of respondents said they do not operate in rent-regulated markets and would not consider doing so because of the threat of rent control, and 15% said they have made no changes yet but are considering doing so in rent-controlled markets.
This pullback is occurring despite clear signs of market moderation, underscoring concerns that rent regulations such as rent control risk discouraging new housing supply precisely when easing conditions suggest market forces are already working to ease affordability concerns.
The January 2026 Quarterly Survey of Apartment Conditions, in which 98 CEOs and other senior executives of apartment-related firms participated, was conducted from January 6 - January 20, 2026. We also asked this question in January 2022, and in comparison, the 2026 findings suggest a growing pullback from regulated markets.
The share of respondents who said they have cut back on investment or development in rent controlled markets increased from 26% in January 2022 to 35% this round; the share who said who do not operate in these markets and would not consider doing so because of the threat of rent control also increased from 32% four years ago to 41% this round; while the share who said they have made no changes yet but are considering doing so in these markets remained at 15%.
This means that the total share of respondents who have altered their investment or development decisions—or are considering doing so—has increased from 73% of respondents in January 2022 to nearly all (91% of respondents) in this latest iteration.
Finally, just 7% of respondents this round said they do not plan any change in investment or development in markets affected by rent regulation (down from 23% last round), and 2% said they do not operate in these markets but would consider doing so despite the threat of rent control (down from 4% four years ago). These findings come as broader apartment market conditions continue to ease nationwide.
The Market Tightness Index (32) came in below the breakeven level of 50, indicating lower rent growth and higher vacancies for the second consecutive quarter. The Sales Volume Index (47) reflected a pullback in deal flow, while the Equity Financing Index (53) and the Debt Financing Index (75) signaled more favorable conditions for the availability of capital.
“A softening labor market combined with high levels of new apartment supply is resulting in slowing rent growth in many parts of the country,” noted NMHC’s Chief Economist, Chris Bruen. “This continues to be most pronounced in sunbelt markets, many of which are currently seeing falling rents.”
“We’ve seen a modest decline in long-term interest rates over the past three months—the 10-Year Treasury Yield is currently down 28 basis points (bps) from July—resulting in improved conditions for debt financing and an uptick in apartment deal flow.”
- The Market Tightness Index came in at 32 this round—below the breakeven level of 50—indicating looser market conditions. Forty-three percent of respondents thought market conditions were looser than three months ago compared to only 7% who thought conditions were tighter. Half (50%) of respondents, meanwhile, thought market conditions were unchanged from three months ago.
- The Sales Volume Index dropped to 47 from October’s 59, indicating a slowdown in deal flow. While most respondents (63%) reported sales volume to be roughly unchanged, just 14% of respondents said sales volume was higher than three months ago compared to 20% who said sales volume had decreased.
- The Equity Financing Index of 53 reflected the second consecutive quarter of equity financing becoming more available. Most respondents (57%) said equity financing was about as available as three months ago, 21% reported an increase in the availability of equity financing, while 15% reported decreased availability.
- The Debt Financing Index remained high at 75, indicating more favorable conditions for debt financing than three months ago. The majority of respondents (53%) reported more favorable conditions for borrowing compared to three months ago, 41% saw no change, and only 3% reported worse debt financing conditions.
About the Survey: The January 2026 Quarterly Survey of Apartment Conditions was conducted from January 6 - January 20, 2026. 98 CEOs and other senior executives of apartment-related firms nationwide participated.
Based in Washington, D.C., the National Multifamily Housing Council (NMHC) is where rental housers and suppliers come together to help meet America’s housing needs by creating inclusive and resilient communities where people build their lives. We bring together the owners, managers, developers and suppliers who provide rental homes for 40 million Americans from every walk of life—including seniors, teachers, firefighters, healthcare workers, families with children and many others. NMHC provides a forum for leadership and advocacy that promotes thriving rental housing communities for all. For more information, contact NMHC at (202) 974-2300, email the Council, or visit NMHC's website at nmhc.org.
