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Key Takeaways UDR is expected to post modest revenue growth, while adjusted FFO per share may edge lower year over year.UDR expects higher NOI, strong occupancy and share repurchases to support sequential FFO growth.UDR continues to benefit from improving coastal markets, while weaker Sunbelt pricing remains a risk. UDR Inc. (UDR - Free Report) , a premier multifamily real estate investment trust (REIT), is set to announce its second-quarter 2026 results after the closing bell on July 27. Its quarterly results are likely to reflect growth in revenues but a dip in funds from operations (FFO) per share.

In the last reported quarter, this Denver, CO-based residential REIT came up with an FFO as adjusted per share of 62 cents, in line with the Zacks Consensus Estimate. Results reflected year-over-year growth in rental rates, while expense growth weighed on same-store net operating income (NOI).

In the last four quarters, UDR’s FFO as adjusted per share met the Zacks Consensus Estimate on two occasions and surpassed it on the other two, the average surprise being 1.60%. The graph below depicts the surprise history of the company:

As we approach the release of UDR'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.

US 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, SC; Savannah, GA; Huntsville, AL; Salt Lake City, UT, 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 UDR’s Upcoming ResultsUDR enters second-quarter 2026 results with operating trends largely on plan. Management expects blended lease rate growth of 1.5% to 2% and occupancy in the mid-96% range, with April performance still near the first-quarter level of 1.6%. Coastal markets remain the main growth driver, with San Francisco and New York showing the strongest rent gains, while Dallas continues to improve.

Renewals should remain supportive, with offers running around 5% to 5.5% and signed renewals expected within roughly 100 basis points of that range. Record resident retention and lower turnover should help protect occupancy, reduce operating costs and support cash flow. However, some Sunbelt markets, particularly Florida and Nashville, softened in April and could limit upside.

For earnings, UDR guided second-quarter adjusted FFO to $0.62-$0.64 per share, with the midpoint of $0.63 implying about 2% sequential growth. The improvement is expected to come from higher NOI and accretion from share repurchases funded by asset sales. Overall, the quarter should show steady revenue growth, solid occupancy and better sequential earnings, though expense pressure and weaker Sunbelt pricing remain key risks.

Projections for UDRAmid these, we expect occupancy to stay elevated at 96.7%, a 10-basis-point improvement sequentially. We estimate same-store revenues to grow 1.2% year over year for the second quarter.

The Zacks Consensus Estimate for quarterly revenues is currently pegged at $425.19 million. This indicates a marginal year-over-year rise.

Before the second-quarter earnings release, the company’s activities were inadequate to gain analysts’ confidence. The Zacks Consensus Estimate for the quarterly FFO as adjusted per share has remained unrevised at 62 cents over the past three months, suggesting a 1.56% decrease year over year.

Here Is What Our Quantitative Model Predicts for UDROur proven model does not conclusively predict a surprise in terms of core FFO per share for UDR 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.

UDR 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.