The Rise of Build-to-Rent Housing
16 hours ago
- Build-to-rent (BTR) homes are single-family homes built specifically for renting, rising from under 2% of new housing starts in the 1990s to over 7% today.
- The BTR industry originated after the 2008 financial crisis, when foreclosures and tightened lending pushed millions into renting, and investors bought distressed properties cheaply.
- The Senate's 21st Century ROAD to Housing Act threatens BTR by requiring institutional investors to sell rental homes after seven years, halting new project funding.
- BTR homes range from detached single-family houses to horizontal multifamily developments, designed to minimize maintenance costs and maximize rents.
- Demand for BTR is driven by housing unaffordability, rising interest rates, and a preference for renting over owning among some demographics.
- Institutional ownership's effect on home prices and rents is debated: some studies show price increases, while others find net benefits from added rental supply.
- Supporters argue BTR expands rental options and is a product of market conditions, not the cause of housing unaffordability.
- The article concludes that building more housing and cheaper construction methods are better solutions than banning BTR.