**Investing In, Insuring, and Financing Single-Family Rentals: Q&A with Kiavi’s Charles Goodwin**
Positive market fundamentals continue to drive success in the single-family rental (SFR) and build-to-rent (BTR) spaces. As a result, a growing number of investors are eyeing these asset classes. ConnectCRE recently spoke with Charles Goodwin, Vice President of Bridge and DSCR Lending at Kiavi, to get the latest insights into trends, opportunities, and considerations for those interested in this growing sector.
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**Q: What’s currently going on in the SFR and BTR space?**
**A:** Despite slowing activity in the for-sale housing market due to rising inventories of resale and new construction properties, SFRs and BTRs remain solid performers. Nationally, SFR rent growth is around 4% year-over-year—lower than the 10%–15% growth seen during the pandemic surge, but still indicative of a healthy market.
One key driver is the high cost of homeownership, which is now nearly double the cost of renting in many areas. In states like Texas, where inventory surged in recent years, levels are starting to taper off, suggesting that market stabilization may be on the horizon. Some would-be sellers, unable to fetch desired sale prices, are turning homes into rentals, adding to the overall supply and making leasing more competitive.
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**Q: What insurance considerations should SFR investors know about?**
**A:** Every investor should ensure they carry three fundamental types of coverage:
1. **Property Insurance:** Protects against damage or total loss.
2. **Liability Insurance:** Covers lawsuits or accidents occurring on the property.
3. **Loss of Rent Coverage:** Safeguards income if the property becomes uninhabitable.
Depending on your strategy, other policies such as builder’s risk (for major renovations), vacancy coverage, or endorsements for short-term rentals may also be necessary.
Investors should be mindful of the timing around natural disaster seasons like hurricanes and wildfires. Insurers may pause policy issuance during these periods, so it’s wise to secure coverage 30 to 45 days before closing. When filing claims, weigh the size and nature of the issue—minor damage may be best handled out-of-pocket, whereas major damage should be reclaimed through insurance. Frequent claim filing can negatively affect premiums and future eligibility.
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**Q: What about foreclosures—are there opportunities for investors?**
**A:** Not imminently. Despite headlines, foreclosure activity remains low. Most homeowners have significant equity, reducing the likelihood of distressed selling. Successful investors will need to be proactive by forming relationships with sellers early in the cycle rather than waiting for an influx of foreclosure inventory.
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**Q: What should investors consider when entering new markets?**
**A:** Job growth is a critical driver, closely tied to long-term rental demand and market stability. Investors should also evaluate local rental supply, affordability metrics, and economic fundamentals. Data sources such as Redfin can help in understanding area-specific trends.
Real estate is inherently local. Strategies effective in one market may not translate successfully to another due to differences in zoning laws, permit processes, or title report specifics. For those investing in out-of-state markets, having local partners or a trustworthy on-the-ground team is vital. Knowledge of the neighborhood and alignment between the investment approach and local market conditions are also essential to avoid costly missteps.
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**Q: Is the BRRRR (Buy, Renovate, Rent, Refinance, Repeat) strategy still effective in today’s environment?**
**A:** Yes, the BRRRR strategy remains viable, particularly with appropriate financing structures. The process typically starts with a short-term bridge loan used to purchase and renovate a property. Once the renovation is complete and the unit is leased, refinancing into a Debt Service Coverage Ratio (DSCR) loan allows investors to move into longer-term financing at more favorable rates.
This approach can offer stronger cash-on-cash returns, especially when value is added during renovations. Proper execution may even allow investors to recoup a portion of their initial investment, while retaining a stabilized income-generating asset and positioning themselves for future deals.
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**Q: Overall, what should SFR investors focus on right now?**
**A:** The best advice is to stick with the fundamentals. Build trustworthy relationships, have financing and insurance lined up before making offers, and avoid banking on a massive wave of foreclosures—it likely won’t materialize. Today’s homeowners are in better financial positions with more equity, and widespread distress isn’t part of the current picture.
For those exploring investments outside their immediate area, strong demand markets that haven’t experienced significant overbuilding hold the most promise. With homeownership costs now roughly double that of renting—compared to a decade ago—the gap is funneling more would-be buyers into rentals, particularly in the SFR segment.
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*An earlier version of this article originally appeared on ApartmentBuildings.com.*
**Join us at Connect Apartments 2025!**
Registration is now open for Connect Apartments 2025—a one-day event delivering expert insights into all facets of the multifamily market. The conference will take place on September 11, 2025, at the Fairmont Century Plaza in Los Angeles. Don’t miss this opportunity to network with industry leaders and deepen your investment knowledge.
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*Originally published by Connect CRE.*
