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6.5.23  – Multifamily Dive

A RentCafe study shows construction of single-family rental homes jumped 47% year over year in 2022 and reached a record high. The total of 14,500-plus homes is more than twice the pre-pandemic pace of homebuilding, with growth spurred by pandemic-related lifestyle changes, as well as elevated interest rates and housing prices, the study shows.

Dive Brief:

  • Over 14,500 new single-family rental homes were constructed across the country in 2022. This marks an all-time high, up 47% from 2021 and more than double the peak yearly construction rate before the COVID-19 pandemic, according to a new study from RentCafe.
  • The trend shows no sign of slowing. Nearly 44,700 new build-to-rent homes — defined in the study as horizontal apartment-style units in neighborhoods of 50 or more — are underway across the country. Phoenix has the busiest pipeline with 5,500 build-to-rent homes under construction, followed by Dallas at 4,400 and Houston at 2,600.
  • RentCafe attributes the surging growth of the BTR sector to the lifestyle changes brought on by the COVID-19 pandemic, including social distancing and working from home, as well as high housing prices and interest rates that make purchasing a difficult prospect.


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Dive Insight:

The totals for new single-family build-to-rent homes delivered and under construction by the end of 2022 surged far ahead of the mid-year numbers that Yardi Matrix, RentCafe’s parent company, recorded last August

Eleven of the nation’s major metros saw surges in new BTR home construction in the past five years, ranging from 100% to 700%. Charlotte, North Carolina, and Atlanta saw the steepest jumps, up from a few hundred five years ago to more than 1,300 and 1,800, respectively. 

A chart of new single-family build-to-rent construction over the last 10 years.

Phoenix has the largest build-to-rent housing inventory at 8,239, more than triple its count in 2018. The single-family home ownership market was hard hit by the housing crisis of 2008, after which institutional investors bought two-thirds of the homes that were no longer owner-occupied, about 20,000 units total, according to RentCafe. Now recovered, the region’s population growth has created a high demand for rentals — both in build-to-rent communities and in formerly owner-occupied homes.

One byproduct of the work-from-home trend is the need or desire for more space. The average size of a BTR home rose by 2.6% in 2022, up to 1,361 square feet, or an estimated four bedrooms. Projects have also become larger and denser, according to RentCafe, averaging 130 units per property. 

Demand and social trends

Occupancy for BTR units has risen slightly since the middle of last year, up to 97% — higher than the standard apartment occupancy rate at 95%. According to RentCafe, this speaks to the popularity of and demand for build-to-rent units among renters. 

Many of the nation’s largest single-family for-sale home builders are also getting in on the trend, dedicating a growing share of their yearly completions to single-family BTR projects. Twelve of the top 50 home builders in the country reported single-family rental homes in their closing numbers last year, led by No. 2 builder Lennar with 2,418 rental homes closed in 2022. They are:

Builder 100 RankBuilderSFR units built, 2022Total closings, 2022
1D.R. Horton51882,930
8Clayton Properties Group4811,751
12Ashton Woods Homes1658,591
14Dream Finders Homes6726,878
18David Weekley Homes2975,270
20Stanley Martin Homes2014,426
21DRB Group3204,282
25Perry Homes483,693
35Landsea Homes1572,527
41True Homes952,044


While single-family rentals have proven an attractive investment option over the past several years, interest rate hikes have buffeted some of the transaction activity and rent growth in the space. However, because investors see safety in build-to-rent, the space should remain active, according to Adam Wolfson, CEO of Miami-based BTR developer Wolfson Development Co. 

“Right now, I’m seeing both on the lending side and the equity side, the capital markets with respect to BTR are coming back,” he said.