Single-Family Rental Market Index (SFRMI) | John Burns Real Estate Consulting

Single-Family Rental Market Index


JBREC/NRHC Single-Family Rental Market Index 2Q21: Single-Family Rental Market Index Stays Near Record Highs

The overall Single-Family Rental Market Index cooled slightly to 84 in 2Q21, down from an all-time high of 90 in 1Q21. While down sequentially, the index is still sharply higher year over year (YOY) from 76 in 2Q20. 

This quarterly index and survey of single-family rental operators is a partnership between John Burns Real Estate Consulting (JBREC) and The National Rental Home Council (NRHC).

JBREC research clients receive monthly SFR market updates, including visibility on new lease rent growth, forecasts, and occupancy trends. In addition, research clients can access our SFR Burns Interactive Dashboards to analyze, compare, and rank the 63 largest SFR markets in the country while drilling deeper into housing information.


 

Our 2Q20 SFRMI survey shows:

  • Rent growth accelerated in 2Q21, driven by still strong demand and tight supply.
    • Same store new lease rent growth of 10.4% and renewal rent growth of 5.1% drove blended rent growth of 6.5% in 2Q21. For perspective, new leases grew 8.7% in 1Q21 and renewals rose 5%, equating to 6.1% blended growth.
      • This is the highest blended rent growth in our survey history back to 2019 and more than double the 2.8% blended rent growth back in 2Q20.
      • 35% of operators have basically no inventory (occupancy at 99% to 100%), up from 26% in 1Q21.
    • Same store average occupancy hit a new all-time high in our survey during 2Q21, reaching 98%. Occupancy has improved steadily since the beginning of our survey in 2019, jumping from already healthy pre-COVID levels of 95% to 96%.
  • National median rent at $1,751 according to operators we survey, who skew towards higher price points.
  • 2Q21 current leasing activity and expected leasing activity (next six months) both rose YOY.
    • Our current leasing activity index hit 91 in 2Q21, down slightly from 94 in 1Q21, but still well above year ago levels of 77 in 2Q20. The expected leasing activity index for the next six months hit 84 in 2Q21, also down sequentially from 96 in 1Q21, but up YOY from 75 in 2Q20. The scale ranges from 0 (Very Weak) to 100 (Very Strong), with 50 being Normal.
  • 98% occupancy for same store portfolios in 2Q21, beating the previous record of 97.4% in 1Q21.
    • The occupancy sub-index reading fell to 71 in 2Q21, down from 80 in 1Q21. Scale ranges from 0 (Lower) to 100 (Higher), with 50 being the Same. Note that this slight decline is a result of more operators rating occupancy as similar to the very high rates of prior quarters, which were very high already. As such, we don’t interpret it as a negative trend.
This proprietary survey measures the overall health and sentiment of national single-family rental markets. We conducted the quarterly survey from August 2 through August 19, looking back at 2Q21 market conditions.
The 2Q21 survey results include 182 market ratings from professionally managed single-family rental operators who collectively manage 208K properties in 57 US metropolitan areas.

 

 


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If you would like to participate in future surveys, please contact Devyn Bachman at dbachman@realestateconsulting.com.

SFRMI Methodology

The Single-Family Rental Market Index (SFRMI) is a diffusion index comparing weighted responses of operators on three key aspects of their business (below/above 50 = contracting/expanding):

  • Current leasing activity
  • Expected leasing activity in the next six months
  • Occupancy of their same-store portfolio1 compared to one year ago

The SFRMI survey asks operators to rate current leasing activity and expected leasing activity in the next six months as either Very Strong, Strong, Normal/Average, Weak, or Very Weak. Operators also rate the occupancy of their same-store portfolio compared to one year ago as Higher, the Same, or Lower.

1Same-store store portfolio includes only homes that have undergone initial rehab or were stabilized (i.e. initial rehab completed) 90 days prior to the beginning of the corresponding period in the prior year; excludes properties held for sale.


About The National Home Council

The National Rental Home Council (NRHC) is the trade association dedicated to advocating on behalf of the 16 million home single-family rental industry and its residents. The NRHC supports efforts to strengthen neighborhoods by filling an important need in today’s growing rental housing market.

About John Burns Real Estate Consulting

John Burns Real Estate Consulting (JBREC) is an independent research provider and consulting firm focused on the housing industry. John Burns founded the company in 2001 because he saw a need for better analysis on the housing market. The company has grown to a highly passionate team of research analysts and consultants in offices across the country, who work together to provide the most trusted source of US housing analysis. John Burns Real Estate Consulting’s research subscribers receive the most accurate analysis possible to inform their macro investment decisions, and the company’s consulting clients receive specific property and portfolio investment advice designed to maximize profits.


Jody Kahn If you have any questions about the Single-Family Rental Market Index, please contact Jody Kahn, Senior Vice President at jkahn@realestateconsulting.com.
Devyn Bachman If you have any questions about the Single-Family Rental Market Index, please contact Devyn Bachman, Senior Research Manager at dbachman@realestateconsulting.com.