SINGLE FAMILY RENTAL OUTLOOK GENERALLY POSITIVE HEADING INTO 2023
What does the forecast look like for the single-family rental and build to rent industries heading into 2023? As the economy continues to teeter and a housing shortage persists, demand for rental housing is expected to increase.
A decade-long trend to continue watching in 2023 is the growth of institutional investors in the single-family rental industry. Many sizeable investment firms are now entering the single-family rental market, attracted by the potential for stable and long-term returns. As the real-estate industry tries to balance overpriced homes and high interest rates, billions in institutional dollars sit waiting in the wings. The not-so-distant memory of 2008’s market collapse has investors salivating at the opportunity for rental payments that turn profits monthly. Once real estate prices per square foot or interest rates reach target levels for investment, expect a feeding frenzy of institutions buying up single-family homes.
While rental home purchases have slowed over the past 3 months to wait for prices to cool off, the build-to-rent model has become a more and more viable option for investors with money they’re required to spend. The sentiment being: If homes are too expensive to buy, get to your target price by building your own. Construction material costs are coming back to earth and a ground-up construction project offers more opportunities for value engineering to keep expenses under control.
Although momentum has slowed recently, the single-family rental and build-to-rent industries are both expected to experience significant growth in 2023. The numbers may not come to fruition until Q2 or Q3, but American consumers still need places to live and the SFR model has proven there is money to be made in buying and holding homes.
ABOUT RMI FLOORING
RMI Flooring is the number #1 flooring provider in the US of single-family rentals. With more than 15 locations across the country, RMI was founded to service the SFR industry from its inception in 2011. For flooring information or quotes, please Contact Us here.