A prolonged period of elevated interest rates –– compounded by rising operational costs –– continues to impact rental housing providers nationwide. Beyond myriad effects on day-to-day industry operations, rising rates also pose a long-term risk to the future of apartment availability and affordability.

At its recent meeting in March, the Federal Reserve kept rates unchanged, leaving short-term rates at a 23-year high since last July. While the Fed still anticipates rate cuts later in 2024, Chair Jerome Powell continues to express caution in their approach.

"We're in a situation where if we ease too much or too soon, we could see inflation come back," said Chair Powell in March. "If we ease too late, we could do unnecessary harm to employment." With optimism for a rate cut early this year gone, the potential longer-term impacts are starting to dominate industry conversations as providers continue to grapple with skyrocketing operational expenses while awaiting the Fed's next decision point this summer. Many owners and operators are navigating these specific economic hurdles –– and more widespread distress in the market –– for the first time.