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Study: SFR Providers are Shifting Acquisition Methods

Single-family rental operators are moving more toward build-to-suit rentals with which to fill their portfolios, according to the Q4 2021 Single-Family Rental Market Index (SFRMI) released by the National Rental Home Council and John Burns Real Estate Consulting. The data comes from the Single-Family Rental Survey, which is conducted each quarter.

The index noted that 26% of SFR rental operator portfolio growth came from ground-up construction (from new builders or in-house efforts), representing an increase from 11% in Q4 2020 and 3% in Q4 2019. Meanwhile, one-off resale homes accounted for 57% of acquisitions. While this metric was unchanged from the 58% reported in Q4 2020, it represented a large decrease from the 81% reported in Q4 2019.

Other information from the survey includes the following:

  • The national median single-family rent climbed to $1,898, rising by 9% year over year
  • Same-store new lease rent growth dipped slightly, quarter over quarter, to 12.6%, while renewal rent growth remained flat at 8.0% from the previous quarter
  • Lease-up times generally remained the same, compared to the year before, with 79% of operators nationally indicating that vacant properties are taking the same or less time to lease than one year ago

Data for the SFRMI came from single-family rental home providers operating in more than 50 metropolitan areas across the United States, which managed more than 200,000 properties.

A release from the NRHC indicated that there are 870,000 more renter households today than there were at the beginning of the COVID-19 pandemic. Additionally, the amount of owner-occupied housing in the United States increased by more than 10% over the past five years, while the amount of rental housing stock increased by just over 2%.

“During and following the COVID health crisis, access to single-family rental homes has become even more important as Americans have had to adjust to new realities of working and schooling from home,” said David Howard, the NRHC’s Executive Director. Single-family rental homes provide a convenient and affordable option for families searching for either a short- or long-term means to address their housing needs.”

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National Rental Home CouncilJohn Burns Real Estate Consulting

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