NREI: Plummeting Homeownership Rate Good News for Investors in Single-Family Homes
According to NREI:
The rate of homeownership in the U.S. has steadily declined since 2006. It has now reached a 50-year low, according to the U.S. Census Bureau. What does this mean for the growing industry of institutional investors in single-family rentals?
“The trend of declining homeownership is an opportunity for institutional owners of single-family homes. We expect homeownership to continue to trend lower until an eventual bottoming in 2018. The outlook for near-term rental household formation and subsequent demand for single-family rentals is favorable. In the long-run, a reversal in the homeownership rate is a negative for single-family rentals relative to apartments,” says John Pawlowski, senior associate at Newport Beach, Calif.-based real estate research firm Green Street Advisors.
According to Green Street’s Pawlowski, “The geographic footprint for institutional single-family rental owners is largely concentrated across the Sun Belt region, where single-family home prices are generally more affordable than coastal markets.”
To read the full article from NREI, click here.