CalculateRealEstateROI

Multifamily

What rent growth should I underwrite?

Conservative: 3% Year 1, 3% thereafter. Bull: 5% Year 1 then 3%.

Reviewed by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Direct answer

Conservative: 3% Year 1, 3% thereafter. Bull: 5% Year 1 then 3%.

Expanded explanation

Don't extrapolate recent peaks. Long-term rent growth correlates with wage growth (~3%). Underwriting at 5–8% across a 5-year hold is aggressive and unlikely to print.

Examples

  • 3% base case across 5-year hold from $1,500 → $1,738.

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