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Key Takeaways Equity Residential is expected to post higher Q2 revenues and normalized FFO year over year.EQR benefited from high occupancy, lower concessions and improved lease pricing entering Q2.EQR's FFO estimate stayed at $1.01, while its Earnings ESP remained at 0.00%. Equity Residential (EQR - Free Report) is slated to report second-quarter 2026 results after the closing bell on July 22. The company’s quarterly results are likely to reflect growth in both revenues and funds from operations (“FFO”) per share.

In the last reported quarter, this Chicago, IL-based residential real estate investment trust’s (“REIT”) normalized FFO per share surpassed the Zacks Consensus Estimate, delivering a surprise of 4.21%. However, rental income lagged the consensus mark.

Over the trailing four quarters, Equity Residential’s FFO per share surpassed the Zacks Consensus Estimate on one occasion, met in two and missed in the remaining period, with an average surprise of 0.81%. The graph below depicts this surprise history:

As we approach the release of Equity Residential's second-quarter 2026 earnings report, it is important to examine how this residential REIT is likely to have performed amid the current market conditions.

U.S. Apartment Market in Q2The U.S. multifamily market entered the second half of 2026 with a clearer recovery taking shape, as strong renter demand and a rapidly shrinking supply pipeline began translating into lower vacancy and improving rent growth.

According to a Cushman & Wakefield report, net absorption reached roughly 124,600 units, up from 83,500 units in the first quarter and 8% above the prior year, making it the fifth-strongest quarter in nearly 25 years. The supply picture also became more favorable. Approximately 88,000 units were delivered during the quarter, down 27% year over year. Around 475,000 units remained under construction at quarter-end, equal to just 3.5% of existing inventory.

Improving demand and slowing supply pushed the national vacancy rate down 35 basis points quarter over quarter to 8.9%, its first move below 9% since 2024. On a trailing four-quarter basis, absorption of approximately 362,000 units exceeded deliveries of about 358,000 units for the first time since early 2022, indicating vacancy is likely to have passed its cyclical peak. The recovery was particularly pronounced in previously overbuilt markets: Austin, Charleston, Savannah, Huntsville, Salt Lake City and Colorado Springs recorded some of the largest quarterly vacancy declines.

Rent growth remains modest but is beginning to improve. National asking rents reached approximately $1,945 per month, up 1.5% year over year, compared with 1.1% growth in the first quarter. The Bay Area led the recovery, with San Francisco rents rising 13%, San Jose 7% and the East Bay 4.8%. Norfolk, Toledo, Reno and Boise also posted strong gains.

High-supply markets remained softer, with rents still declining in Austin and Sarasota, although the pace of those declines moderated as excess supply was absorbed. Overall, the market appears to be shifting from stabilization into an occupancy-led recovery, with broader rent growth likely as the construction pipeline continues to shrink.

Factors to Consider Ahead of EQR’s Q2 ResultsThe improving fundamentals across the U.S. apartment market are expected to have supported Equity Residential's second-quarter performance, particularly given its concentration in high-barrier coastal markets where supply pressures are easing.

Equity Residential entered the second quarter of 2026 with strong occupancy and improving leasing momentum. Portfolio occupancy was 96.3% at the end of the first quarter, while net effective pricing had increased more than 4% since the start of the year. Concession use was also down about 21% from a year earlier, giving management confidence that pricing should continue to improve through the spring leasing season.

The biggest support remains the supply backdrop. EQR expects new apartment deliveries across its markets to decline about 35% in 2026, with the benefit becoming more visible in the second half. Low turnover, rising resident incomes and limited homeownership affordability should continue to support occupancy and renewal performance.

Overall, second-quarter 2026 results are expected to show gradual improvement rather than a major breakout. High occupancy, lower concessions and stronger renewal spreads should support better blended lease growth, while the sharp slowdown in new supply is expected to set up stronger operating momentum.

Projections for EQRWe expect second-quarter same-store revenues to increase 2.6% year over year, while same-store net operating income is estimated to grow 2.2%. Physical occupancy is expected at 96.4%.

Currently, the Zacks Consensus Estimate for the company’s quarterly revenues is pegged at $789.8 million, indicating a 2.73% year-over-year increase. For the second quarter of 2026, the company projects normalized FFO per share in the range of 98 cents to $1.02.

Before the second-quarter earnings release, the company’s activities were not adequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly normalized FFO per share has remained unchanged in the past two months at $1.01. However, it suggests 2.02% year-over-year growth.

Here Is What Our Quantitative Model Predicts for EQROur proven model does not conclusively predict a surprise in terms of FFO per share for Equity Residential this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an FFO beat, which is not the case here.

Equity Residential currently carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks That Warrant a LookHere are two stocks from the broader REIT sector — SL Green Realty (SLG - Free Report) and Cousins Properties (CUZ - Free Report)  — you may want to consider, as our model shows that these have the right combination of elements to report an FFO beat this quarter.

SL Green is slated to report quarterly numbers on July 22. SLG has an Earnings ESP of +7.20% and a Zacks Rank of 3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Cousins is slated to report quarterly numbers on July 30. CUZ has an Earnings ESP of +0.45% and a Zacks Rank of 3 at present.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.