Single-Family Built-for-Rent Construction Down

Single-family starts built-for-rent were down sharply on a year-over-year basis, falling to only 5,000 starts for the second quarter of 2013 compared to 9,000 a year prior. While the market share of built-for-rent single-family units remains elevated, the share appears to be declining off post-Great Recession highs.

According to data from the Census Bureau’s Quarterly Starts and Completions by Purpose and Design, the market share of single-family homes built-for-rent, as measured on a one-year moving average, stands at 5% for the second quarter of 2013. This remains significantly higher than the historical average of 2.8%, but is down from the 5.8% registered in the first quarter.

SF built for rent_q2_13

With the onset of the Great Recession, the share of built-for-rent homes rose, with a dip in the percentage during the homebuyer tax credit period.

Despite the elevated market concentration, the total number of single-family starts built-for-rent remains fairly low – only 29,000 homes started during the last four quarters.

Of course, the built-for-rent share of single-family homes is considerably smaller than the single-family home portion of the rental housing stock, which is 27% according to the 2010 American Community Survey. The reason for this is that as single-family homes age, they often transition to the rental housing stock.

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4 Responses to Single-Family Built-for-Rent Construction Down

  1. […] Single-family starts built for rent were down sharply on a year-over-year basis, falling to only 5,000 starts for the second quarter of 2013 compared to 9,000 a year prior. The market share of single-family homes built for rent, as measured on a one-year moving average, stands at 5% for the second quarter of 2013. This remains significantly higher than the historical average of 2.8%, but is down from the 5.8% registered in the first quarter. […]

  2. […] For the second quarter of 2013, the share of cash purchases rose slightly to 7.4%. The high point for cash purchases occurred in the third quarter of 2011 when the market share was a somewhat larger 7.9%. In contrast, for August existing home sales, cash purchases totaled 32%, compared to 27% in August 2012. The cash share for new homes is smaller because cash buyers in the existing home market are looking for bargains for rental purposes, while for-sale new construction is dominated by owner-occupiers. […]

  3. […] For the second quarter of 2013, the share of cash purchases rose slightly to 7.4%. The high point for cash purchases occurred in the third quarter of 2011 when the market share was a somewhat larger 7.9%. In contrast, for August existing home sales, cash purchases totaled 32%, compared to 27% in August 2012. The cash share for new homes is smaller because cash buyers in the existing home market are looking for bargains for rental purposes, while for-sale new construction is dominated by owner-occupiers. […]

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