Housing-News-Report-November-2017

HOUSINGNEWS REPORT

THE RISING ‘BIG MIDDLE’ OF SINGLE FAMILY RENTALS

SFR MARKET BY INVESTOR PORTFOL IO SIZE: FEB 2017

SFR MARKET BY INVESTOR PORTFOL IO SIZE: NOV 2017

100+

100+

10%

16%

11 TO 100

11 TO 100

14%

23%

6 TO 10

6 TO 10

4%

6%

8%

12%

3 TO 5

3 TO 5

79%

67%

1 TO 2

1 TO 2

Migrating to Middle America Rand also noted the mid-tier investors his company targets are more willing than the mammoth institutional investors to move to smaller secondary and tertiary markets — many of them further from the coasts and deeper into middle America. “One of the things we’re excited about is the secondary and tertiary markets that are getting some action. … What was being done in Nashville, they’re doing in Chattanooga instead. Oklahoma City instead of Dallas,” he said, noting that this migration is happening in different ways. “Some of them are acquiring and growing. Some of them are liquidating and re- capitalizing and looking for a new play. They are not riding off into the sunset.” Five years after acquiring a portfolio of 150 single family rentals mostly in Florida, Jamie Nahon is one of those mid-tier investors looking to move to middle America.

“We finally landed on the experienced private investor as the way to refer to people who are serious, not rookies, and they are active as hell right now. … More than 200,000 investors that own about half a trillion dollars of real estate 15 properties at a time.”

GREG RAND CEO, OWNAMERICA

(SFR) investors have been the most active in 2017.

accounting for 79 percent of the overall SFR market in February 2017 — a 15 percent decline in market share. Meanwhile, segments of the market represented by investors owning more than two rental homes have all increased from February to November, led by investors owning between 6 and 10 rental homes (market share up 65 percent) and followed by investors owning 100 or more rental homes (market share up 59 percent); and investors owning 11 to 100 rental homes (market share up 58 percent).

While the biggest segment of the SFR market, both in terms of number of properties and number of investors, is still by far the mom-and-pop investor who owns one or two single family rentals, that segment is shrinking. Mom-and-pop investors owning 1 or 2 properties accounted for more than 13.1 million of the nearly 19.5 million single family rentals nationwide (67 percent) in November 2017, but that was down from 15.2 million homes

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NOVEMBER 2017 | ATTOM DATA SOLUTIONS

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