---
title: What Happens to Multifamily Investments During a Recession?
description: Discover how multifamily investments fare during a recession and why they remain a profitable option for real estate investors. Learn why multifamily rents tend to outperform other property types and how they quickly rebound after a downturn. Get insights on the resilience and profitability of multifamily properties over the long term.
image: https://insights.westworthcapital.com/hubfs/Economy-Recession.jpeg
---

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 Nov 21, 2023 12:15:08 PM

# What Happens to Multifamily Investments During a Recession?

![Picture of Dami Fadipe](https://insights.westworthcapital.com/hs-fs/hubfs/Untitled%20design%20(6)-modified.png?width=50&name=Untitled%20design%20(6)-modified.png) [Dami Fadipe](https://insights.westworthcapital.com/blogs/author/dami-fadipe)

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For real estate investors, the past decade has been profitable as property values and rental rates increased. However, recent changes, like higher interest rates and a bearish stock market, raise concerns about a possible recession.

![Economy-Recession](https://insights.westworthcapital.com/hs-fs/hubfs/Economy-Recession.jpeg?width=580&height=387&name=Economy-Recession.jpeg)

 

In the past, during the 2007 housing market crash, home prices plummeted due to a flood of foreclosed properties. However, multifamily rents behaved differently. [During recessions, demand for rentals tends to rise as people struggle to buy homes or face foreclosure](https://westworthcapital.com/elementor-11255/). While rents in large apartment properties did drop during the [Great Recession (0.3% in 2008 and 4.1% in 2009), they quickly rebounded.](https://www.urban.org/sites/default/files/publication/27011/1001550-Rental-Market-Stresses-Impacts-of-the-Great-Recession-on-Affordability-and-Multifamily-Lending.PDF)

In fact, multifamily rents tend to outperform other property types during recessions and recover faster afterward. By the end of 2010, rents were rising again in most surveyed metropolitan areas. Even during the peak of the Great Recession in 2009, with a 10% unemployment rate, many rental properties increased rents just one year later.

This is good news for multifamily investors. Even when U.S. asking rents dropped by 4.1%, it wasn't a significant disruption. For a property renting at $1,500 per month, a 4.1% reduction is only $61.50 per month. This minor dip doesn't justify giving up on multifamily real estate, especially for those planning long-term investments for consistent cashflow.

Since 2000, U.S. multifamily rents have increased on average by 4.17% annually, even considering setbacks from the Great Recession.

Despite economic uncertainties, housing remains a fundamental need, and people prioritize it over other expenses. So, investing in multifamily properties is advisable, as they have historically shown resilience and profitability over the long term. 

To understand how we force the appreciation on our multifamily investments and how you can take your real estate investing game to the next level, grab a copy of our passive investor guide below 👇👇

 

 

[real estate](https://insights.westworthcapital.com/blogs/tag/real-estate), [rentals](https://insights.westworthcapital.com/blogs/tag/rentals), [Investments](https://insights.westworthcapital.com/blogs/tag/investments)

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## [Why multifamily properties are recession-proof](https://insights.westworthcapital.com/blogs/elementor-11255)

[westworthcapital](https://insights.westworthcapital.com/blogs/author/westworthcapital) 

 Apr 22, 2023 8:59:08 AM

During a recession, many types of investments may suffer losses, leaving investors worried about...

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## [Single Family vs Multifamily Investing: How are they different?](https://insights.westworthcapital.com/blogs/single-family-vs-multifamily-investing-how-are-they-different-0)

![Picture of Dami Fadipe](https://insights.westworthcapital.com/hs-fs/hubfs/Untitled%20design%20(6)-modified.png?width=50&name=Untitled%20design%20(6)-modified.png) [Dami Fadipe](https://insights.westworthcapital.com/blogs/author/dami-fadipe) 

 Nov 12, 2023 12:34:58 PM

Dear there, The decision is yours. Investment in single-family homes and multifamily properties can...

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## [What is Debt Service Coverage Ratio (DSCR)?](https://insights.westworthcapital.com/blogs/what-is-debt-service-coverage-ratio-dscr)

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 Apr 27, 2023 7:15:35 PM

Debt Service Coverage Ratio (DSCR) is a critical financial metric for real estate investors,...

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🌐 Dive into the World of Passive Investing📈 📈 . Unlock the Power of Multifamily Real Estate with Our Exclusive Guide 💡 .  

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