According to Yardi Matrix — the Santa Barbara, California-based provider of research and reports on multifamily, student housing, office, industrial, and self-storage properties across the U.S. — 6,740 new built-to-rent homes were completed in 2021. This is the highest yearly total to date on record. Other industry sources, including a new RentCafe study (RentCafe is a subsidiary of Yardi Matrix) indicate that the trend is just beginning and growing at a significant pace.
Single-family rentals are not a new concept, and the pandemic created an unprecedented demand among renters for space and privacy. According to a RentCafe survey of 3,300 renters, as many as 78% said they were interested in living in a community of single-family homes.
Currently, there are about 90,000 existing single-family homes in the U.S. among nearly 720 communities designed specifically for renting. They include single-family detached houses, townhomes, duplexes, and even quadruplexes that come with a backyard or a garage — sometimes both.
Alexandra Ciuntu, author of the RentCafe report said, “It’s easy to see the appeal of built-to-rent homes: The trend combines the financial and leasing flexibility of a rental with the amenities and convenience of a professionally managed property, all while living a single-family home lifestyle.”
Because developers need large lots to build on, rental home communities are prevalent in low-density areas, with the majority (61%) located in suburbs and 39% situated in more urban areas, according to the study.
“While they’re more likely to be found in urban settings in the Southwest, they tend to be more present in suburban areas in the Midwest and Northeast,” Ciuntu added. “Either way, single-family rentals are filling up fast, with the occupancy rate in 2021 2% higher than apartments (97% compared with 95%).”
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Built-to-Rent Homes Expected to Hit All-Time High in 2022, Fueled by Need for Space and Privacy