Arbor’s Single-Family Rental Investment Trends Report
According to Arbor’s Q1 2021 Single-Family Rental Investment Trends Report, if there were three real estate headlines to come out of the pandemic, they would focus on work-from-home trends, online retailing and single-family rentals (SFRs). Adding to that, they say that by the end of the year SFRs may be the only one of the three to avoid some post-pandemic reversion. In fact, Arbor goes on to to say that SFRs are now increasingly filling the role that starter homes had for previous generations and professional residential operators are quickly racing into the sector. Indeed…
In major metropolitan areas, activity restrictions, acute job losses and public safety perceptions drove out residential demand — especially millennials with a loose attachment to their urban lifestyles. In adjacent suburban markets and smaller metros, demand sprang up as newly remote-working, former city dwellers sought a “new normal” amid a perplexing world event. SFR, a supply-constrained, still mostly mom-and-pop sector with a rapidly growing institutional presence, was uniquely positioned to absorb the sea change.
- Cap rates ticked up to 6.0%, up from 5.9% the prior quarter
- Vacant-to-occupied rent growth accelerated to a new all-time high
- Purpose-built single-family rental (SFR) units accounted for 4.5% of single-family construction
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