Why Multifamily Real Estate Deals Are Struggling in 2025 — Insights for Passive Investors

Multifamily real estate deals are facing unexpected turbulence in 2025, leaving many passive investors questioning their next move. A combination of rising interest rates, maturing short-term debt, soaring insurance premiums, and operational costs is putting serious pressure on deal performance. Add in aggressive underwriting from previous years, oversupply in key markets, and slowed rent growth — and it’s clear why even strong assets are now struggling. This blog breaks down six critical reasons behind the current challenges in multifamily real estate deals and offers practical insights to help passive investors make informed, risk-managed decisions in a volatile environment.