Owners weighing whether to sell or restructure multifamily assets before the end of 2026 are facing a complex market. According to a recent Marcus & Millichap report, sales volume increased roughly 20 percent year-over-year. However, supply constraints vary by region and tax regulations are shifting, making it difficult to rely on headlines alone.
Ask Advisors About Their Incentives
Brokers typically earn a fee only when a transaction closes. That compensation model can create a conflict of interest, so owners should ask how the advisor would handle a situation where selling is not the best move. A good advisor can identify specific scenarios where holding the property makes more sense, perhaps based on the owner’s tax position or investment timeline. An advisor who cannot name a reason to wait is likely focused on their own paycheck rather than the client’s best outcome.
Owners should also ask who is pricing their asset and against what data. Advisors often use broad regional averages, which can be misleading. It is better to request submarket-level figures that account for block-by-block differences. For instance, advisors working in the Bay Area might note that San Francisco and San Jose posted some of the fastest rent growth in the nation, but that growth is uneven. An advisor who can explain why one neighborhood is outperforming another is pricing on evidence, while one citing only a metro-wide cap rate is guessing.
How to Leverage Bonus Depreciation
The One Big Beautiful Bill Act permanently restored 100 percent bonus depreciation for qualifying property placed in service after January 19, 2025. IRS guidance issued this year clarified how this applies to phased renovations, including a component election that allows owners to claim deductions on parts of a project as they are completed. Owners need to ask their advisor to explain exactly where their asset falls within this timeline rather than just reciting the rule in the abstract.
Planning a 1031 exchange requires a clear replacement strategy before the clock starts. The 45-day identification and 180-day closing windows are strict. Owners should discuss potential replacement candidates, including what is available in their own submarket, before marketing their property. Asking an advisor what markets and asset types they are already tracking on your behalf is a practical step to take before signing a listing agreement.
Think Beyond the Sale Price
Owners should also consider how a transaction sets up their position for the next 10 years. The best outcome is rarely the highest price today; it is the position left after taxes five or even 10 years out. An advisor should connect the current sale, exchange, or hold to succession plans and the next transaction. For example, a recent sale of Pacific Apartments in Livermore, California, for $5.6 million allowed an investor to use a 1031 exchange to buy Briarwood Apartments nearby for $19.75 million. This move more than tripled the unit count, reset depreciation, and kept the client in a submarket they already knew.
Recent data from Marcus & Millichap indicates that 42 of the country’s 50 major markets expect fewer multifamily deliveries. This supply-constrained environment suggests that patient, well-advised owners may have an advantage over those who rush into decisions. Advisors must avoid using generic summaries like “shows” or “trends” when discussing these market shifts. Instead, they should state the facts directly. The focus remains on the specific numbers and regional variances that drive the investment choices.
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