What's the Future of Built-for-Rent Single-Family Homes?

Built-for-rent single-family housing has grown in popularity for the past eight years due to intense demand. Renters include Millennials who are just forming their families, but also young singles and older empty-nesters who prefer a larger space that remains professionally managed, according to Forbes. Single-family rentals, specifically, have been around for some time—about one household per eight households in the US are a single-family rental. But the demand has only grown, and although companies are constructing these rentals en masse, there are still not enough to meet demand. Read more to learn about new rental home communities.

The successful players in this space can tell you that it’s an opportunity, but not a “no-brainer.” One has to strategize carefully, and differently than one does in the for-sale business, about land as well as product. In this business, you think differently about what makes a good location, and you have to have a long-term mentality when designing and finishing the homes.

This is a period of expansion, but also of experimentation and testing, within this relatively young niche. The various players in this space have vastly different approaches. Some are creating single-family communities on a single plat, similar to an apartment building (hence the term “horizontal multifamily,”) while others, like American Homes 4 Rent AMH -0.9% (AH4R) have individual lots/plats for each house.

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