Office Attendance Crosses a New Post-Pandemic Threshold

• Office redemption: Office attendance just reached its strongest level since the pandemic, suggesting a more durable return than many expected.

• Renter renovations: Affluent renters are reshaping luxury apartments by pushing for customized leases and upgraded, personalized living spaces.

• New year, new outlook: Forecasts for 2026 suggest the U.S. housing market will become a bit more affordable as home price gains slow and sales pick up.

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Essential Metrics

Office Occupancy Trends and Insights

Office attendance crosses a new post-pandemic threshold

Office attendance just hit a milestone that would have seemed unlikely a year ago. The latest Kastle Back to Work Barometer posted its strongest readings since the pandemic began, with the week of December 8 delivering record highs across weekly averages and single-day peaks. Coming right after Thanksgiving, the data points to something more durable than a seasonal blip. Office usage is not only holding up. In some markets, it is quietly accelerating.

The headline number matters. Occupancy across all tracked office buildings climbed to a 56.3 percent weekly average, the highest level since early 2020. That alone would be notable, but the gains were not limited to trophy assets. While A+ buildings once again led the market, the narrowing gap between premium space and the broader office stock suggests that attendance is rising across property types. A+ buildings rebounded to nearly 79 percent weekly occupancy, while overall buildings pushed past previous post-pandemic highs. This looks less like a flight to quality story and more like a broad-based return to routine.

Tuesday once again emerged as the dominant in-office day, reflecting how hybrid schedules have solidified rather than faded. On that day, A+ buildings reached more than 95 percent occupancy, effectively full by any practical standard. Even more telling, all office buildings hit a new post-pandemic single-day record at 66 percent. The consistency of these peaks suggests that office attendance is becoming more predictable, which is something landlords, operators, and tenants have been waiting for.

The momentum is showing up at the city level as well. Washington, DC reached a new post-pandemic high, New York pushed its weekly average close to 60 percent, and Austin posted one of the strongest numbers in the dataset, setting a city record above 92 percent midweek. These are very different office markets with different tenant mixes, yet all are moving in the same direction. When occupancy gains show up across government-heavy, finance-driven, and growth-oriented markets at the same time, it signals a broader behavioral shift.

Zooming out, the 10-city Barometer average set a new record for the second time in less than a month. That kind of incremental improvement matters. It suggests that the return to office conversation is evolving from a question of whether people will come back to one of how often and how consistently they will show up. For owners, that distinction is critical. Stability, even at levels below 2019, is easier to underwrite, operate, and plan around.

The timing is also important. These gains arrived in the middle of the holiday season, a period that traditionally sees softer attendance. If anything, that strengthens the case that a new baseline is forming. The office may not return to five days a week for everyone, but the data increasingly points to a durable hybrid equilibrium. As 2026 approaches, the Kastle numbers suggest that what once felt transitional is starting to look like a new normal.

Overheard

When High-Income Renters Start Treating Apartments Like Custom Homes

An emerging cohort of affluent households is reshaping the high end of the rental market. Data shows that the number of wealthy renters earning top incomes has surged in most large U.S. metros in recent years, with the share of renters in the highest income brackets rising meaningfully since 2019. In some markets, households earning over $150,000 or even $1 million are opting for rental living rather than buying, a shift driven by high mortgage costs, lifestyle preferences and the desire for flexibility.

National rent growth overall has been modest, with average asking rents rising just over 1 percent in early 2025 and higher-end properties often showing slower rent increases and elevated vacancy rates relative to mid-priced stock. That means operators of four and five-star buildings contend with supply that has grown faster than demand in some markets, even as affluent renters parcel out cash for upgrades and personalization.

A growing base of high-income renters willing to customize their space opens the door to longer leases, tenant improvement allowances, and premium finishes that look more like office build-outs than traditional apartment turnovers. For landlords, these arrangements can quietly lift effective rents through higher monthly payments, longer lease terms, or upfront contributions that reduce downtime, all without pushing headline rents higher in markets where luxury pricing is already under scrutiny. That can be especially appealing in a period of muted rent growth, where operators are looking for yield in the margins rather than through annual increases.

At the same time, these bespoke deals complicate underwriting and valuation. Custom build-outs introduce capital expenditures that are harder to standardize, extend lease up timelines, and raise questions about reusability when a tenant leaves. Appraisers and buyers then have to decide how much of that tenant specific value actually transfers to the next renter, adding uncertainty to exit pricing and cap rate assumptions. In that sense, customization may boost near-term cash flow while quietly adding complexity and risk to the long-term investment story.

Forecasts Show Slower Price Growth and Rising Sales for 2026 Real Estate

Predictions for the U.S. housing market in 2026 suggest a subtle shift in affordability as growth in home prices is forecast to slow well below wage gains, making houses cheaper in real terms than in recent years. Analysts see median home-price growth in the low single digits, more modest than in 2025, and expect existing-home sales to rise for the first time since 2021. Mortgage rates are still likely to hover above historical norms, and forecasts for sales gains vary widely, reflecting a range of views on how quickly buyers will reengage. The mix of slower price momentum and slightly improved payment dynamics could ease barriers for some buyers even if overall costs remain high compared with long-term averages.

The divergence in forecast expectations highlights ongoing uncertainty around how much affordability really matters to buyer behavior. Even modest declines in payment pressure might coax first-time buyers or move-up buyers off the sidelines. But without more meaningful rate drops or substantial inventory relief, sales and price trends could vary significantly from region to region. Slower price growth won’t erase affordability challenges, but it could reduce the frequency of deals falling apart due to cost shocks or valuation mismatches.

The shifting affordability picture could create some strategic tradeoffs. In multifamily markets, tighter housing affordability tends to bolster rental demand and occupancy as potential buyers defer purchases and stay in apartments longer, though forecasts suggest rent growth will be modest in 2026 as supply constraints ease and demand stabilizes. Investors focused on multifamily might find that a slight uptick in homebuying activity dampens some of the rental tailwinds that carried performance in recent years.

At the same time, slower price appreciation could temper expectations for single-family home investments and build-to-rent strategies, especially where deal yields compress relative to risk. The interplay between price trends, wage growth, and sales volumes in 2026 will likely influence capital flows across sectors and test whether modest gains in affordability can materially change how and where investors deploy real estate capital.

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Propmodo Daily is written and edited by Franco Faraudo with contributions from readers like you and the Propmodo team.

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