This trend is expected to accelerate post-pandemic. Housing demand surged during the pandemic, and as of today, 36% of renting households (roughly 16 million people) have ditched their multi-unit apartment complexes to rent single-family homes. As millennials grow into life stages that require the space and benefits provided by single-family homes, demand significantly rises. The BTR industry provides this 60% with a desirable alternative. A staggering 60% of Americans can’t afford to buy a home. Today's millennial apartment renters are tomorrow's first-time homebuyers-or, if the current market holds, tomorrow's first-time single-family renters. BTR creates a great alternative for this generation while providing outstanding returns for investors. Scarce housing stock, combined with record-high prices and interest rates, has made homeownership a dim prospect for millennials. The added pressure brought several firms to the realization that building these single-family rental portfolios (subscription needed) would not only yield higher returns but also solve a major problem for the emerging class of home buyers: millennials. However, limited housing stock and tight market competition forced investors to get creative.
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