WHY BUILD-TO-RENT (BTR)?

  • Housing Shortage

    From 2001-2020 an estimated 26 million new homes were needed to meet demand. However, builders were only able to produce 18.9 million homes—leaving a shortfall of over 7 million homes.

  • Rising Interest Rates

    With 30-year mortgage rates topping more than 7%, many would-be homebuyers are no longer able to afford a home purchase. The Fed’s policy shift has resulted in higher mortgage rates and consequently, increased monthly payments.

  • Renters by Choice

    Americans prefer the flexibility to move and change locations. What’s more, they want to forgo the sizable down payment, as well as property taxes and maintenance costs associated with homeownership.

  • J.P. Morgan

    “The COVID-19 epidemic only helped cement the position of BTR units as a safe, growing asset class. While occupancy rates and rent collection plummeted across almost every real estate class, BTR stayed almost untouched. Occupancy across several large portfolios stayed over 95% with over 92% rent collection.

  • Toll Brothers

    “The new build-to-rent product is considered safer and better performing. The fact that it doesn’t have to be renovated and can be designed to incorporate the latest amenities and features, i.e., technology, that renters demand is no small factor as well.”

  • The Wall Street Journal

    “Single-family BTR homes are emerging as the hottest corner of the U.S. property market, as investors respond to booming demand from home-seekers priced out of housing for sale.”

  • Hunter Housing Economics

    “Build-to-rent communities offer families the space they need even if they lack the budget to buy such a spacious home. There are two groups who gravitate toward BTR: those who cannot afford a home, whether because of the higher monthly cost or the lack of funds for a down payment, and those who are renters by choice.”

THE UPSIDE OF RENTING

  • No Large Down Payment

    A rental deposit is typically equal to the amount of one month's rent, much less than a required down payment which can be 20-30% of the home’s purchase price—a hefty upfront cost to get moved in.

  • No Real Estate Taxes

    URG residents do not incur real estate taxes, which can be a substantial burden for homeowners and vary based on the estimated property value of the house.

  • Reduced Insurance Costs

    Homeowners are required to maintain a homeowner's insurance policy, while renters invest in a renter's policy. This type of policy is much cheaper than a homeowner’s policy and still provides extensive coverage.

  • Reduced Utility Costs

    URG builds efficient floor plans using green construction materials, including Low-E vinyl windows, spray foam insulation, LED lighting, energy-saving appliances, and more—resulting in a more affordable monthly utility bill.

  • Low Maintenance

    Unlike homeowners, URG residents do not incur repair bills for exterior or interior issues. They are not burdened by the cost and the time required for potentially pricey maintenance and repairs.

  • Stable Monthly Payments

    URG residents can budget more effectively since they know upfront the required amount of rent due each month. Whereas, a mortgage and the amount of property tax and insurance can change.

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