Institutional investment in SFRs on the rise

Institutional investment in single-family-rental (SFR) homes is on the rise and expected to grow dramatically over the next eight years, according to a new bulletin on the sector released by Yardi® Matrix. Rising interest rates, however, are forcing investors to reassess the most effective strategies for growing portfolios and may contribute to lower near-term returns.

Institutions have committed more than $60 billion to buying single-family homes during the past year.

Recent research by MetLife Investment Management (MIM) estimated that institutions own about 700,000 single-family rentals in 2022, about 5 percent of the 14 million SFRs nationally. MIM forecasts that by 2030, institutions will increase SFR holdings to 7.6 million homes, more than 40 percent of all SFRs. Institutional acquisitions of SFRs in communities of 50 or more units soared in