In this issue, you’ll see the full results of the LendingOne-ResiClub Single-Family Rental Investor Survey.
Real estate investors who own at least one single-family investment property were eligible to respond to the LendingOne-ResiClub SFR Investor Survey, fielded between June 25 and July 18. ResiClub, our partner for the survey, is a news and research outlet dedicated to covering the U.S. housing market.
Our Topline Findings for the SFR Housing Market:
- 60% of single-family landlords say they’ll likely buy at least one investment property over the next 12 months.
- 39% of single-family landlords say they’ll likely sell at least one investment property over the next 12 months.
- 76% of single-family landlords expect to raise their rents over the next 12 months—including 35% who say the increase will be over 4.0%.
- 2% of single-family landlords expect to decrease their rents over the next 12 months.
- 72% of single-family landlords expect home prices to increase in their core housing market over the next 12 months. But only 31% expect an increase of over 4.0%.
- 86% of single-family landlords expect interest rates to fall over the next 12 months. However, just 10% of those landlords expect a decline of more than 1 percentage point.
- 50% of single-family landlords say home insurance was their expense that increased the most over the past 12 months
Big picture: The survey reveals that a significant majority of single-family landlords are cautiously optimistic about the SFR housing market over the next 12 months, with many planning to buy properties, raise rents, and anticipate rising home prices and falling interest rates. However, they only expect a mild increase in rents and home prices and a mild drop in interest rates while also reporting that home insurance costs are an area of concern.
“The survey result generally aligns with what we have heard from clients and from data over the last 12 months,” says LendingOne CEO Matthew Neisser. “We saw apartment rents starting to stall months ago; apartment rents were already leveling out in most markets and becoming more competitive with concessions. So, on the single-family side, apartments can be a benchmark as a competing product.”
“Generally affordability is coming into play on both apartments and the SFR space,” he continues. “It seemed logical there’s only so much rent growth in some of the markets. That being said, clients are becoming more active as inventory starts to rise and rates have improved.”
Below, you can find the full results broken down by regional SFR housing market:
How Likely Single-Family Rental Investors Are to Buy Another Investment Property in the Next 12 Months
How Likely Single-Family Rental Investors Are to Sell Any of Their Investment Properties in the Next 12 Months
How Much Single-Family Rental Investors Plan to Raise Rents Over the Next 12 Months
How Single-Family Rental Investors Expect Home Prices to Shift in Their Core Housing Market over the Next 12 Months
What Single-Family Rental Investors Expect to Happen to Interest Rates in the Next 12 Months
“Inventory reached unprecedented lows during and after the COVID-19 pandemic, making it challenging for investors to acquire properties and expand their portfolios due to fierce buyer competition,” Neisser continued. “However, as the market stabilizes, we anticipate increased buying opportunities for our clients. It’s important to note that while significant rent appreciation is less likely in the current climate, investors should still base their purchasing decisions on realistic expectations.”
Neisser added that if investors are right, and interest rates come down a bit, even better. “All else being equal, rates coming down is great for our investors, period”
This quarter’s survey uncovered interesting insights about how real estate investors are weathering the current economic dynamics. Stay informed with our latest news and advice by visiting our blog. And when you’re ready to take the next step, learn how our loan products can help you achieve your investment goals.