Nation’s First Dedicated SFR Transactional Platform Hits $1 Billion in Listings Further Indicating Strong Nationwide SFR Market Growth
PHOENIX, AZ, July 31, 2019 – SVN | SFRhub Advisors, based in Phoenix, got its start as the first and only nationwide dedicated SFR (single-family residential) and BFR (Build-for-Rent) portfolio brokerage, part of the global SVN® brand. In Q1 2019, SVN | SFRhub Advisors launched SFRhub.com, the nation’s first, fully transactional, single-family rental digital platform in which buyers and sellers can list, shop, and buy both SFR and BFR investment portfolios online. Today, SVN | SFRhub Advisors announces $1 billion in listings, supporting further large-scale investor interest in the single-family rental market.
SFR portfolios, comprised of five or more homes, consist of both existing single-family residential (SFR) properties and new construction Build-for-Rent (BFR) subdivisions that are quickly becoming the fastest-growing commercial real estate asset class. Since the housing market crash over 10 years ago, the SFR and BFR market has grown tremendously as distressed homes were bought up by investors who have now shifted their strategy to SFR rentals on a large-scale. “We have seen huge growth in the amount of demand for SFRs and more recently over the past two years, the BFR sub-segment. Buyer demand has surged and it’s going to continue to grow nationwide,” said Michael Finch, Executive VP and Principal at SVN | SFRhub Advisors. “Our background is in development, construction, investment brokerage, and finance, so we recognized years ago that a lot of the big distressed single-family home buyers were starting to move to existing rental homes and new construction rentals as Millennials and Gen Xers continue to not purchase homes and baby boomers are choosing, in huge numbers, to rent and downsize, getting rid of their larger homes.”
According to a recent Freddie Mac survey, about 50% of millennials prefer to continue renting while a surprising 72% of baby boomers are choosing to rent over homeownership as well. In fact, renters of single-family homes rent for longer durations compared to apartment dwellers, with millennials at approximately 3.2 years and baby boomers at about 8.4 years, as mentioned by John Burns Real Estate Consulting, making SFR rentals even more enticing for investors because of the reduced resident turnover costs as compared to traditional multifamily.
John Burns Real Estate Consulting states there is an unappeasable demand in the single-family residential rental market that will continue strong throughout 2022, even with an expected modest recession. Currently, 94.3% of all U.S. SFR rental homes are occupied, the highest level in over 20 years since 1997, while rents nationwide have increased 4% YOY as of March 2019. The Phoenix market ranks above the weighted average of the top 20 largest single-family rental markets for occupancy rates at 93.6%. Phoenix has a current median single-family home rental rate of $1,389 that is continuing to grow rapidly in this high-demand market at 6.2% YOY. Due to steady job growth and healthy occupancy rates, John Burns Real Estate Consulting also forecasts that Las Vegas, Orlando and Phoenix landlords will have the most pricing power in the U.S. through 2022.
Since its recent launch, SFRhub.com has grown substantially to be the first SFR portfolio brokerage to hit the $1 billion level with seller listings with no slow down in sight. “The key to quality-accelerated growth for our national platform is by far our highly experienced expert dedicated SFR team combined with over 200 SVN offices operating nationwide in more than 500 submarkets,” said Jeff Cline, Executive Director and Principal at SVN | SFRhub Advisors. “We recently underwrote, in less than 12 months, the 400th SFR investment portfolio.” These investment portfolios are located in many markets across the nation including top rental growth markets such as Phoenix, Orlando, Las Vegas and Atlanta, to name a few, where rents are up about 7% YOY.
SVN | SFRhub Advisors has disrupted the SFR portfolio investment space by creating a large-scale, single-source, dedicated SFR/BFR platform for buyers and sellers to complete data market research, valuations, marketing, offers and full online digital transaction processing. The time required, overhead cost and transaction expenses are reduced drastically for all parties. Through ease of use and access to listings, it is now easier than ever to become involved in the single-family rental investment portfolio space, encouraging further growth in this market as investors can buy or sell entire portfolios online nationwide versus single properties locally. “We have multiple clients with well over a couple billion dollars worth of capital looking to invest in this asset class. One group is looking to acquire 5,000 to 6,000 homes over the course of 18 to 24 months in the BFR space,” said Finch. “There are multiple groups like that in the SFR world and many of the SFR REITs, like Amherst and TriCon American Homes, are considering the BFR space in a big way.”
Big players in both institutional investment groups and national builders are rapidly expanding into this market, with a target focus on BFR investments. Toll Brothers recently announced a $60M joint venture with a top BFR builder, BB Living, based in Phoenix, according to CNBC. “It’s true, SFRhub is working with most of the large national and regional builders across the country as well as countless multinational and international private equity, family office and alternative asset management companies exploring and entering the Build-for-Rent asset class,” said Finch. “This only just the beginning of a very large investment class shift.”
For more information on SVN | SFRHub Advisors or to view current portfolio listings, please visit www.SFRhub.com.
About SVN | SFRhub Advisors
SVN | SFRhub Advisors is an independently owned and operated SVN® office located in Phoenix, AZ. Currently, SVN nationally comprises over 1,600 advisors and staff working in more than 200 offices across the nation. SVN | SFRhub Advisors is the nation’s first and only dedicated SFR portfolio brokerage providing an advanced technology acquisition, research, marketing, transaction and data platform supporting both sellers and buyers of residential rental investment portfolios. SFRhub.com is the only SFR industry national data provider with clean and verified data to ensure intelligent decisions by the buyer, seller and lenders. As the national market leader in the SFR investment industry, SVN | SFRhub Advisors currently features a pipeline of more than $2 billion existing assets (SFR) and new Build-for-Rent (BFR) investment portfolios consisting of five or more homes.
Amy Graham, Marketing and Communications
SVN | SFRhub Advisors