Broken Banking: Impacts on Multifamily Investments

Federal Interest rates have been regularly increased several times this year—amidst ongoing banking turmoil and broader market uncertainty. These shifts in monetary policy raise important questions for investors: How will these changes affect real estate, and where can your capital still thrive? One proven solution to keeping your money in places that grow and protect wealth is through multifamily real estate investments—especially during unpredictable times

Multifamily real estate is one of the safest investment options regardless of the economic climate.

Multifamily real estate continues to be one of the safest and most consistent investment options, regardless of where we are in the economic cycle.

Several factors contribute to this resilience:

• Housing is a basic need. Despite market fluctuations, people will always need a place to live. A severe housing shortage across the U.S. ensures steady demand and high occupancy rates in apartment communities.

• This persistent rental demand means that multifamily investments can provide consistent monthly cash flow, even during economic slowdowns. Unlike more speculative asset classes, rent checks don’t stop coming when the market dips.

• Historically, real estate investing—particularly in the multifamily sector—has been less volatile than the stock market, offering a more predictable and stable return on investment over time.

• New development deals are increasingly difficult to justify due to elevated construction costs. As a result, ground-up starts have meaningfully declined. This makes value-add investment strategies—where we acquire and improve existing properties—more attractive and cost-efficient than ever.

• Early data from Q1 2025 suggests a trend of normalizing rental growth, reinforcing the long-term stability of multifamily cash flow even as short-term volatility continues elsewhere.

• Multifamily also offers significant tax advantages, including depreciation, cost segregation, and the ability to defer capital gains through 1031 exchanges. Combined, these provide powerful tools for wealth preservation and growth.

At Viking Capital, we create operational efficiencies and strategically upgrade our properties to ensure our investments continue to drive up NOI. This gives our investors long-term appreciation of their capital, steady cash flow, tax benefits, and creates a meaningful source of passive income.

 

In fact, on our most recent acquisition Crossings at McDonough our investors are immediately getting their distributions, and NOI is already hitting year 1 proforma targets. Even during a mild recession, the benefits of investing in our strategic multifamily acquisitions continue to provide investment and capital safeguards.