The single-family rental market is set for a booming trajectory, with several large institutional investors making big bets on build-to-rent properties. Arrived is one such real estate platform that enables retail investors to invest in single-family rental homes. According to a Wall Street Journal report, more and more large players, including private equity firms, are betting billions of dollars to tap into the budding single-family rental business.
The report noted prominent firms, such as AvalonBay Communities (AVB), Blackstone (BX), and Invitation Homes (INVH), as major listed players in the single-family rental space. These companies are switching their investments to boost their build-to-rent portfolios instead of investing in build-to-sell properties.
Why Is the Rental Market Gaining Popularity?
The report points out that renting homes is coming to the fore, with home ownership becoming more difficult owing to elevated property prices. As millennials come of age to start their families and enter home-buying years, they are finding it increasingly tough to buy their dream homes in good neighborhoods. They prefer shifting to rental homes with high-quality features in areas closer to such neighborhoods. These single-family rental homes all feature upscale characteristics, such as backyards, a porch, and a garage.
The report also noted that since home builders are shifting focus on supplying more rental properties, it is negatively impacting the housing supply. This also means that due to poor supply, home prices are not coming down anytime soon. Indeed, single-family rental homes are emerging as a new, attractive asset class.
Stats Don’t Lie
According to the National Association of Realtors (NAR) forecast, the median home price of homes for sale is expected to rise by another 2% in 2025, while mortgage rates are expected to hover around 6%. The stats display how buying a home is still expected to remain a distant dream for several millennials.
According to the NAHB’s (National Association of Home Builders) analysis, the single-family built-for-rent (SFBFR) construction for Q3 2024 jumped 41% year-over-year and continues to take center stage in builders’ portfolios.
How Arrived Makes Renting Homes Easier
Privately set-up Arrived (earlier Arrived Homes) is helping retail investors to handsomely leverage the ongoing single-family rental wave. It believes that residential real estate is one of the best long-term investments. The Arrived platform offers individual investors an opportunity to invest in pre-vetted rental properties or vacation rentals from some of the finest neighborhoods in the U.S.
Interestingly, investors can become rental property owners for a minimum investment amount of $100, thanks to Arrived’s fractional ownership option. Consequently, investors don’t need to make huge down payments or initial investments. What’s more, Arrived handles most of the hassles of real estate investing, including identifying and vetting properties, documentation, loan requirements, and the aftercare of rental properties. Arrived also manages all tenant-related activities such as renovations, finding tenants, bookings, maintenance, and collecting rent on investors’ behalf. Arrived’s platform makes it easy to scan and invest in properties and start earning both regular rental income and appreciation (wherever possible) over time.
As of date, Arrived boasts of having total investments of over $213 million by retail investors in more than 422 properties. Interestingly, Arrived is backed by some of the well-known personalities of Wall Street, having raised over $40 million to date. Amazon (AMZN) founder Jeff Bezos has been an early investor in Arrived. Also, Uber Technologies (UBER) CEO Dara Khosrowshahi and Salesforce (CRM) CEO Marc Benioff have bet their money on Arrived.
This article was written in partnership with Arrived. TipRanks may be compensated for its publication.
