(Featuring Jonathan Ellenzweig, Chief Investment Officer, Tricon Residential)

Over the past two decades, the single-family rental industry has evolved into an institutional-caliber asset class—so where is the sector going next?

https://www.afire.org/podcast/institutionalizingsfrcast/

Over the past decade, the US single-family rental (“SFR”) industry has matured from a largely mom-and-pop cottage business to a professionally managed, institutional-caliber asset class that fills a pronounced gap in the US housing continuum. Before the GFC there were always SFR homes; however, these were typically owned by individuals who were often more focused on near-term cash flow rather than customer service. In fact, in 2005 there were approximately 13 million occupied SFR homes, or 34% of the entire rental housing stock in the US.

The GFC served as a catalyst for the institutionalization of the industry, as large and newly formed technology-enabled owner/operators were able to acquire neglected homes, renovate them, and rent them to families looking for quality rental housing. In many instances, these operators transformed what may have been the worst home on the street into the best. This served to benefit both local homeowners and renters, and served as the genesis of today’s SFR industry.

On this episode of the AFIRE podcast, Jonathan Ellenzweig explains why the SFR industry remains very small and concentrated among a handful of operators – in fact, less than 2% of the country’s approximately 16 million SFR homes are owned by institutional owners.

This podcast is based on the article "Institutionalizing Single-Family" from Summit Journal (Summer 2021).