Crexi and Dwellsy IQ have published a joint research report examining the relationship between rent trends and multifamily cap rates across ten major U.S. metros, using data from Q4 2025. The report, available on Crexi’s site, identifies six markets where the typical rent-to-cap rate relationship has broken down — a pattern with direct implications for how investors screen and underwrite deals entering 2026.
Access the Full Analysis
Read the full report on the Crexi blog to see how rent trends and cap rate movements are diverging across major U.S. markets—and what that means for how you evaluate deals before underwriting begins.
Why This Report Exists
Multifamily underwriting has always depended on two connected data streams: what tenants are paying, and what buyers are accepting on the transaction side. When those streams are analyzed separately, they produce only half the picture. When rents and cap rates move in the same direction — both rising or both falling — pricing is no longer responding to income in the way conventional underwriting assumes.
That misalignment is not an abstract concern. U.S. apartment investment volume reached $165.5 billion in 2025, up 9.4% from 2024, with investor sentiment at its strongest level in two years. Capital is moving quickly and concentrating in specific metros. The markets attracting the most conviction are, in several cases, the same ones where the rent-to-cap rate relationship has broken down most sharply.
This report was built to surface that disconnect before it becomes an underwriting problem.
What the Report Covers
The analysis pairs Dwellsy IQ first-party rent data — sourced directly from 25,000+ property managers via PMS integrations with Yardi, Entrata, AppFolio, and 30+ others, covering 17M+ units — with Crexi median multifamily cap rates from Q4 2024 to Q4 2025.
The ten metros covered: Atlanta, Chicago, New York City, Houston, Dallas, Miami, Boston, Los Angeles, San Francisco, and Washington D.C.
Markets are classified into three types based on the directional relationship between rent movement and cap rate movement over the comparison period:
- Disconnect Type 1 — Rents rising, cap rates also rising (Atlanta, Chicago, NYC). Income is recovering, but investors are demanding higher yields rather than compressing them in response to improving fundamentals.
- Disconnect Type 2 — Rents falling, cap rates also falling or flat (Houston, Dallas, Miami). Buyers are accepting lower yields even as the income stream weakens.
- Aligned — Rents and cap rates moving in opposite directions, as expected in conventional pricing logic (Boston, Los Angeles, San Francisco).
Six of ten markets fall into the disconnected categories. Four are aligned.
How Two Datasets Produce One Screening Layer
Dwellsy IQ covers the income side: rent direction, market-level trends, two-year trajectories, and the supply and affordability context behind the numbers. Data is first-party, sourced directly from property management systems — not scraped, not survey-based — and updated in real time across 16,000+ ZIP codes and 800+ MSAs.
Crexi Intelligence covers the transaction side: what buyers are actually pricing for a given income stream, based on median cap rates from closed multifamily sales.
Used together, they answer a different question than either dataset answers alone. The rent-to-cap rate framework is designed as a screening layer, not a buy/avoid signal. It identifies where to apply more scrutiny before diligence begins — and where the standard underwriting assumptions may not hold.
Frequently Asked Questions
What is the Crexi and Dwellsy IQ report about?
The report examines the relationship between multifamily rent trends and cap rates across ten major U.S. metros using Q4 2025 data. It identifies six markets where rents and cap rates are moving in the same direction — a pattern that diverges from how multifamily pricing typically works and has direct implications for underwriting.
What data sources are used in the rent-to-cap disconnect analysis?
The report pairs Dwellsy IQ first-party 1BR apartment rent data — sourced directly from 25,000+ property managers via PMS integrations covering 17M+ units — with Crexi median multifamily sale cap rates from Q4 2024 to Q4 2025.
Which markets are included in the rent-to-cap disconnect analysis?
The report covers Atlanta, Chicago, New York City, Houston, Dallas, Miami, Boston, Los Angeles, San Francisco, and Washington D.C., plus a national composite.
What does “disconnect” mean in the rent-to-cap context?
In conventional multifamily pricing, rents and cap rates move in opposite directions: stronger income supports higher values and lower cap rates; weaker income pushes cap rates higher. A disconnect is when rents and cap rates move in the same direction, indicating that pricing is no longer tracking income in the usual way.
Where can I read the full rent-to-cap disconnect analysis?
The full market-by-market analysis is published on Crexi’s blog at crexi.com/blog/rent-cap-rate-disconnect-multifamily—combining Crexi’s transaction cap rate data with Dwellsy IQ rent data to surface where market pricing and property income diverge.
