Single-family rental market puts down roots in commercial housing industry

Although a fairly nascent industry in comparison to some of the larger “food groups” of traditional commercial real estate, the single-family rental (SFR) sector is quickly capturing the attention of a growing number of institutional investors.

SFRs are typically a detached home, townhome or duplex situated in a neighborhood — very different from an apartment unit in a multifamily building. Demographically, these property types are more conducive to larger households that want extra space, privacy and neighborhoods with good schools, according to a report from Altus Group published earlier this year. Data shows that institutional investors snapped up an estimated 55,000 to 65,000 SFR homes in 2020; more than 70,000 for-rent homes are expected to be purchased or built in both 2021 and 2022.

While opportunities abound, so do challenges. Buying thousands of homes acr