**Investing In, Insuring, and Financing Single-Family Rentals: Q&A with Kiavi’s Charles Goodwin**
*Positive fundamentals are driving the success of single-family rental (SFR) and build-to-rent (BTR) properties, attracting increased investor interest. ConnectCRE recently spoke with Charles Goodwin, Vice President of Bridge and DSCR Lending at Kiavi, to gain insights into current trends, risks, and strategies in the space.*
**What’s currently going on in the SFR and BTR space?**
Single-family rentals and build-to-rent properties continue to outperform the for-sale housing market, which has slowed with increasing resale and new construction inventory. Nationally, SFR rent growth remains strong—around 4% year-over-year. While this is down from the double-digit gains seen during the pandemic, it still signals solid performance.
The high cost of homeownership—roughly twice the cost of renting in many areas—is a key driver behind the demand for rentals. In states like Texas, where inventory surged recently, levels are now stabilizing, which may bring renewed upward pressure on rents. Some homeowners, not seeing the offers they hoped for, are opting to rent out their properties, increasing rental supply and adding competitive tension to the leasing market.
**What insurance considerations should SFR investors keep in mind?**
Every real estate investor should have three core types of insurance coverage:
1. **Property Coverage:** Protects against damage or catastrophic loss.
2. **Liability Insurance:** Covers accidents or legal claims related to the property.
3. **Loss of Rent Coverage:** Provides income protection if a property becomes uninhabitable.
Supplemental coverage may also be necessary depending on your strategy. For instance, builder’s risk insurance is critical for major renovations, and vacancy or short-term rental endorsements may be required if the property is not leased on a long-term basis.
Timing is also important—especially during hurricane or wildfire seasons, when insurers may pause issuing new policies. It’s recommended to bind policies 30 to 45 days before closing to avoid potential delays. For filing claims, evaluate whether the incident is financially significant enough to justify filing, as frequent small claims can lead to higher future premiums.
**Are there any opportunities in foreclosures right now?**
Not at the moment. While foreclosure concerns persist in the media, actual rates remain low. Many homeowners are in strong equity positions, reducing the likelihood of forced sales. Instead of waiting for distressed properties, investors should consider working directly with sellers earlier in the sales process to uncover opportunities.
**What should investors consider when entering new markets?**
Job growth is one of the most important indicators—it supports long-term demand and market stability. Alongside workforce trends, investors should examine rental supply, affordability, and other market fundamentals. Tools and data centers from platforms like Redfin can help evaluate current trends.
That said, real estate is localized; success in one market doesn’t guarantee the same results in another. Be prepared for challenges like zoning, permitting, and title report discrepancies. Having reliable, local partners is essential, especially when investing out of state. These experts can help navigate regulations and build trustworthy third-party vendor networks.
Investors should ensure that their strategy aligns with the market and neighborhood. A strategy misaligned with local fundamentals significantly increases risk, so thorough due diligence is critical.
**Is the BRRRR (Buy, Renovate, Rent, Refinance, Repeat) strategy still viable?**
Yes, the BRRRR strategy remains effective if approached correctly. The typical path involves using a short-term bridge loan to acquire and renovate a property. Once the property is stabilized and rented, investors can refinance into a longer-term Debt Service Coverage Ratio (DSCR) loan to pay off the higher-interest bridge loan.
This model can generate attractive cash-on-cash returns, particularly when value is added during renovations. In some cases, investors can recoup a substantial portion of their upfront capital—or even pull some cash out—before reinvesting in the next opportunity.
**What should SFR investors focus on now?**
Stick to the fundamentals. Develop relationships with sellers, secure your financing and insurance early, and don’t rely on a potential foreclosure surge—it’s unlikely at this stage. With homeowners holding considerable equity and limited distress in the market, success will favor strategic and proactive investors.
Investors should focus on markets with strong rental demand that haven’t seen a major construction boom recently. With the cost of homeownership approximately double that of renting in some areas, many would-be buyers are remaining in the rental pool, fueling SFR leasing activity.
*This interview originally appeared on ApartmentBuildings.com.*
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For more information on the conference agenda and speakers, visit the official Connect Apartments 2025 website.
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*Originally published on Connect CRE.*
