BTR Sector Fueled by Need for Space, Privacy
Development of single-family rentals is projected to hit an all-time high in 2022.
Driven by renters’ strong demand for more space and privacy—but without the financial commitment—built-to-rent homes have been gaining popularity over the past few years. In fact, 2021 was a record year for single-family rental home construction, with 6,740 new BTR units completed, the highest yearly total to date. And, with twice as many BTR units currently under construction, that trend is projected to grow even more this year.
According to RentCafe.com, a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the U.S., the keyword search volume for “homes for rent” tripled in 2021 compared to the previous year. What’s more, a recent RentCafe.com survey of 3,300 renters revealed that 78 percent of respondents said they were interested in living in a community of single-family homes.
There are approximately 90,000 existing single-family rental homes in 720 BTR communities throughout the U.S., according to Yardi Matrix data compiled by RentCafe.com. Most of the BTR stock, or 61 percent, is located in low-density suburban areas, highlighting renters’ need for more square footage and more personal space, while 39 percent of the BTR stock is located in urban areas with land availability.
On a national level, existing BTR communities were 97 percent occupied at the end of 2021—while apartments were 95 percent occupied—demonstrating renters’ preference for living in a house rather than an apartment, a trend that picked up pace during the pandemic. The top metro for single-family rentals in Phoenix, with 6,420 BTR units in BTR communities as of 2021. Next is Columbus, Ohio, with 4,780 BTR units, followed by Dallas, with 4,290 BTR units.