Despite Rise in Build-to-Rent, Small Investors Dominate Single-Family Rental Market

The single-family rental market has changed in recent years, with new-construction single-family rentals coming onto the market in addition to institutional investors buying up existing housing stock. However, recent data show that small investors continue to make up the bulk of the single-family rental market. Currently, 89.6% of single-family rentals are held by individual landlords who own between one and five rental properties, the ResiClub blog reports, analyzing data from BatchData. Even so, homes that are occupied by the homeowner make up a majority of single-family housing. There are 85.6 million single-family homes in the U.S. with occupants who are also the homeowner, compared with just 15.7 million that are rentals.

Some small mom-and-pop landlords view single-family rentals as a supplement to a 401(k)—or even as an outright alternative to one. Some are accidental landlords who chose to keep their starter home as a rental rather than sell it, while others jumped in during the Airbnb boom.