The single-family rental market posted strong growth during the initial months of the pandemic, from April through June, according to the National Rental Home Council and John Burns Real Estate Consulting’s latest reading from the Single-Family Rental Market Index during the second quarter.
“As the COVID crisis reverberated throughout the economy in the second quarter this year, demand for single-family rental homes surged,” says David Howard, executive director of the National Rental Home Council. “Most Americans will be working and studying from home for the foreseeable future. So they’re looking for affordable homes in quality neighborhoods with all the amenities and conveniences offered by the single-family home lifestyle.”
Researchers note a rise in consumer demand for extra space away from dense urban centers. The top-performing markets in the second quarter were in the Southeast and Southwest.
Occupancy rates have climbed 15 percentage points between the first quarter and second quarter. Further, nearly 60% of property managers say homes are spending less time on the market, which is up from 35% in the previous quarter.
The single-family rental market is expected to continue to expand over the next six months.
“For many Americans, the pandemic has brought a new urgency to the search for housing, and many are discovering the benefits associated with renting a single-family home,” says Howard. “Suddenly living in a small apartment in an urban high rise isn’t as appealing for families navigating the realities of working and schooling from home. Single-family rental homes offer a lifestyle with a full range of conveniences and community amenities without the cost and commitment of homeownership.”
Overall, the Single-Family Rental Market Index had a reading of 76 in the second quarter, which is up from 63 in the first quarter. Scores below 50 signal that the market is contracting while readings above 50 indicate expansion.
The national median rent in the second quarter was $1,602.