Berkadia’s August 28 Beyond Insights webinar, titled “Navigating Market Dynamics in SFR & BTR,” featured a presentation by John Burns, CEO of John Burns Research & Consulting. Other participants included Dori Nolan (SVP – Berkadia Institutional Solutions), Joel Kirstein (Managing Director at Berkadia), and Andrew Curtis (Senior Director). The webinar focused on the current challenges and opportunities in the single-family rental/build-to-rent sector, highlighting the increasing demand for rental housing and limited supply.
Burns emphasized the need for more rental housing options as homeownership becomes increasingly unaffordable. He also noted that while there are currently 66% homeownership rate across 146 million U.S. housing units, there is still a shortage of about two million units in both for-sale and rental markets.
One positive development is that homebuilders are now entering into the rental market due to their strong financial position with low debt levels. This has opened up new opportunities for investors looking to purchase new homes from these builders.
The size of the potential market is also significant with over 45 million rented households – including apartments and single-family rentals – making it almost half as large as the apartment market. However, despite some larger institutional players dominating this space such as Invitation Homes or AMH Progress Residential , most SFR/BTR properties are still owned by smaller landlords who own one to nine units.
Berkadia has seen an increase in investment activity this year compared to previous years with sales volume already running at a pace higher than last year’s total volume ($480 million). This surge may indicate that we have reached bottom cycle lows which could lead to even more activity heading into next year.
In terms of lending sources supporting this investment activity, Fannie Mae , Freddie Mac , life insurance companies have been active on BTR deals while aggregation warehouse lines have been used by larger institutions seeking shorter-term financing options before eventually securitizing or entering into larger programmatic facilities. There are also new entrants in the lending space, such as pension and life insurance companies, who are originating debt through their own platforms.
For those interested in watching a replay of the August 28 webinar, it is available on-demand by clicking here . Overall, Berkadia’s webinar highlighted the vitality of SFR/BTR developments and investments amidst current market dynamics.
