Key Highlights
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SFR remains a standout performer, with single-family rents sitting ~20% above multifamily, underscoring resilience and the need for precision-driven market selection.
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Office-to-residential conversions accelerate, with 70,000+ units in the pipeline and growing momentum reshaping downtown corridors.
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AI becomes an operator advantage, sharpening decision-making for teams that blend clean data signals with real-world judgment.
Introduction
Most headlines chase shiny sectors. But the real opportunities in 2026 will come from the places where fundamentals meet selectivity, and for us at Strand, that continues to put single-family rentals (SFR) at the center of the story. Still, the broader market shifts matter, because they directly influence pricing, demand, and capital allocation across the country.
Below are the 3 forces we believe will define the year ahead:
SFR Demand & Pricing Premium
Single-family rentals remain one of the most resilient segments of U.S. housing. As of early 2025, single-family homes were renting at roughly 20% higher rates than comparable multifamily units, the widest gap on record, according to Zillow.
Demand for space, privacy, and stability remains strong, but the SFR market is shifting from broad momentum to precision-driven performance. Rent growth has normalized from pandemic highs, which puts even more weight on the fundamentals we’ve always focused on: the right locations, the right renovations, and the right operating discipline.
Office-to-Residential Conversion
This may be the quietest, and most underestimated, trend in the market.
With office utilization structurally lower and Class B/C buildings struggling to find a future, cities have begun unlocking a new lever: adaptive reuse.
Across the country, municipalities are deploying zoning reforms, density bonuses, tax abatements, and “conversion accelerator” programs, and developers are responding.
RentCafe’s national analysis tracks over 70,000 units moving through the office-to-residential pipeline in 2025, a meaningful step change from previous years.
These projects will not solve the national housing shortage, but they will reshape downtown absorption, retail demand patterns, investor interest, and the trajectories of specific urban corridors.
Takeaway:
Conversions are becoming a real tool for cities to rebalance underused assets, and they’re poised to reshape several urban cores more than most forecasts suggest.
AI & Innovation
Across PropTech and real-estate advisory firms, AI is moving from experimentation to practical deployment. JLL and other industry leaders have reported accelerated workflows and operational efficiencies where AI is properly governed and integrated.
But the nuance matters: adoption is uneven, model reliability varies, and no algorithm can replace operator judgment.
At Strand, StrandScore™️ is our signal layer, a disciplined, data-informed framework that triangulates public data, proprietary inputs, and stress-tested scenarios. It helps us identify early shifts in migration, supply, pricing, and local economic strength. It sharpens our focus, but it never makes the final call.
Takeaway:
In 2026, AI won’t replace judgment, it will sharpen it. The advantage belongs to teams that pair clean signals with experienced operators.
Conclusion
2026 won’t be defined by a single macro storyline. It will be shaped by firms that understand the signals early, maintain discipline in volatile markets, and combine data with grounded, real-world execution.
At Strand, we’re focused on exactly that: reading the right indicators, weighting risk realistically, and staying selective.
