Construction more than doubled year-over-year in 2022 for single-family build-to-rent (SF BTR) homes, according to Fixr’s industry analyst, Adam Graham.
The volume is more striking when considering the YoY growth into 2021 was only 36%.
Yardi’s RentCafe reported that there are currently 13,910 SF BTR homes under construction in the US (where data is available) helping to support the 106% increase the sector is seeing.
Northmarq’s Trevor Koskovich credits the “massive development pipeline” because the product has fared well across the US.
SF BTR homes are becoming a more desirable rental option in comparison to traditional multifamily.
“There was also a tremendous amount of capital raised in the space and developers are deploying that money aggressively,” Koscovich was quoted in Fixr’s report. “I think there has been a demographic shift and tenants really prefer this type of product.”
Rents per square foot are higher for suburban multifamily rentals than single-family rentals in most markets, according to Yardi Matrix, which in spring began tracking the segment regularly.
‘The New Starter Home’ in the Suburbs
In June, this niche housing market was discussed in depth during a session at the National Apartment Association’s Apartmentalize conference.
Panelists there said it’s “the new starter home in the suburbs” and Greystar, the multifamily housing’s leading developer, which is expanding into this space, said, “We’re changing the American Dream” and another said it’s a “more reliable revenue source.”
Fixr said “couples with kids” and the “desire to live in the suburbs” are the top factors driving the trend.
Phoenix, Columbus, and Dallas are the three biggest markets, according to Fixr.
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