15 Nov Strong Market for Single-Family Rental Properties
Turn on the news any given day and you are likely to hear a story about one industry or another that is struggling because of the pandemic. Single-family rental properties, however – like the kind of homes in Palm Beach handled by property management expert Cara Thompson – are a bright spot in an otherwise gloomy economy.
If you own single-family rental homes and are looking for effective property management in Boca Raton, Delray Beach or Boynton Beach, you might already have noticed the increased demand for your properties as well as your ability to increase rents.
So, what explains the strength of the market for single-family rental properties during the age of Covid-19, while other industries – including rental apartments in some cities – struggle?
To say that Covid-19 is driving the market would be an over-simplification. Wolf Richter of WOLF STREET recently looked at the big shifts underway as the rents for single-family houses rise.
“Like so many trends, the growth in the number of single-family houses for rent, and the increase in rents at those houses, preceded the Pandemic, but the Pandemic has accelerated them,” he says. “In September, single-family rents across the nation rose 3.8% from a year ago, according to the Burns Single-Family Rent Index.”
Rick Palacios Jr., the director of research at John Burns Real Estate Consulting, believes that there are a number of reasons why the recession has not had a negative impact on single-family rents, including the fact that the need to stay at home during the pandemic has prompted many to move to larger homes that can accommodate remote working and learning.
Among the other reasons Palacios cited were:
- High single-family rental occupancy rates, which he says reflect “strong demand heading into the recession.”
- A growing population shift away from expensive urban areas to smaller cities and suburbs with diverse economies – like South Florida, where there is a high proportion of single-family rental operators.
- Relief funding included in the CARES Act which Congress passed earlier this year.