No other real estate sector’s performance during the pandemic can match that of the single-family rental space, says John Burns Real Estate Consulting. Both single-family detached and attached homes fall into this category. But the subset of the single-family rental space, built-for-rent, is the true “winner” in terms of market attractiveness. Though the pandemic did not cause the single-family built-for-rent trend, it has propelled it forward tremendously. This could be because single-family rents are more stable and reliable than apartment rent or even single-family home prices. Even during recessions, single-family rent growth has remained steady.
Single-family rents are more stable than apartments or home prices. On a national basis, single-family rent growth has historically stayed positive, even during recessions. We recently published our Burns Single-Family Rent Index report, which showed US single-family rents up 3.9% YOY in August, exceeding the 3.4% YOY historical average dating back to 1985 (more analysis here). Not one of the 63 markets we track nationally experienced YOY rent declines. Sector fundamentals remain solid. John Burns Real Estate Consulting is currently forecasting annual SFR rent growth in 2020 and 2021. We expect those Sunbelt markets with diversified economies that were outperforming pre-COVID will continue post-pandemic. We anticipate high-growth markets like Phoenix, Salt Lake City, Tampa, Dallas, and Charlotte will outperform the nation overall.