REI INK

Key Insights into the Single-Family Rental Industry

Single-Family Home Rentals on the Rise by David Howard The National Rental Home Council (NRHC) serves as the trade association for the single-family rental (SFR) home industry. NRHC members include owner-operators, builders, vendors, and service providers of single-family rental homes across the country. As part of our mission to provide market research and other tools to guide members through the ever-evolving housing market landscape, below are several key insights which you will find beneficial. SFR Rent Collections According to Chandan Economics and RentRedi, on-time payments in properties managed by independent landlords increased for the first time in five months in October 2024. Approximately 85.5% of tenants made their payments on time, reflecting a marginal (+30 bps) improvement from the prior month. However, compared to a year earlier, on-time payment rates still sit lower by 79 bps. Looking at SFR properties, collections have generally mirrored the all-property type trend. In October, 85.6% of SFR units paid their monthly rent on time — rising 31 bps from September, though remaining down by 52 bps from the same time last year. Encouragingly, SFR’s forecast full payment rate — which considers already received on-time and late payments, plus expected future late payments based on historical patterns — ticked up again to 95.4% in October. Before improving each September and October, the SFR full payment rate had fallen in six of the previous eight months. Flock Homes-ResiClub Real Estate Investor Survey Real estate investors reporting that they are planning to grow their portfolio in the near term varies heavily by region, according to the Flock Homes-ResiClub Real Estate Investor Survey. While overall, 49% of investors said they plan to grow, that figure was primarily weighed down by investors in the Southwest (36%) and West (31%). At least 50% of investors in other regions showed interest in growth, with the Midwest (62%) leading the way. Fifty-eight percent of investors reported that maximizing their cash flow is their primary goal, which makes sense when just 24% expected their rent to outpace expenses. Investors’ most significant concerns compared to pre-COVID were primarily over the prices of insurance, maintenance, and property taxes. However, in line with concerns over cash flow, 14% of investors reported concerns over late or delinquent payments. The National Association of Realtors The National Association of Realtors reported sales of existing homes fell 1.0% in September to a seasonally adjusted annual rate of 3.84 million units, the lowest level since October 2010. On an annual basis home sales declined 3.5%. The median home sales price increased 3.0% from a year ago to $404,500.  Sales of new single-family houses in September totaled a seasonally adjusted annual rate of 738,000, 4.1% above the August rate of 709,000, according to data from the U.S. Census Bureau and the Department of Housing and Urban Development. On an annual basis, new home sales increased 6.3%. September new home sales reached the highest level since May 2023. The median new home sales price was $426,300. U.S. Single-Family Home Rentals Rise Amid Housing Market Challenges According to a report from Minnesota-based date provider IPUMS, the number of renters of single-family homes in the U.S. increased from 14 million in 2020 to 14.2 million in 2023. The report lists high home prices, fluctuating mortgage rates, and limited availability of for-sale homes as factors contributing to the increase. Housing Supply Shortfall Persists Up For Growth, a Washington, DC-based nonprofit focused on finding solutions to America’s chronic housing shortage, released its 2024 Housing Underproduction Report this week, pegging the shortage of homes across the country at 3.85 million. The ten markets with the highest levels of underproduction include:   »            New York-Newark- Jersey City  »            Los Angeles-Long Beach-Anaheim  »            Chicago-Naperville-Elgin  »            Riverside-San Bernadino-Ontario  »            Washington, DC-Arlington-Alexandria  »            Miami-Fort Lauderdale-Pompano Beach  »            Dallas-Fort Worth-Arlington  »            Atlanta-Sandy Springs-Alpharetta  »            Boston-Cambridge-Newton  »            Phoenix-Mesa-Chandler

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Pending Home Sales Rise After Post-Election Surge in Home Tours

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Pending sales posted a big year-over-year increase this week, partly because the boom in early-stage homebuying demand Redfin saw just after the election is translating to sales and partly because Redfin is comparing it to a period in 2023 that included Thanksgiving. U.S. pending home sales rose 12.1% year over year during the four weeks ending November 24, the biggest increase since May 2021. That’s according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. One reason for the outsized increase is that early-stage homebuying demand, including home tours, boomed in the two weeks following the presidential election. But another notable reason is that Redfin is comparing it to a period in 2023 that included Thanksgiving, a time of year when home sales are typically very slow. Redfin will know in the next few weeks whether the increase in pending sales is a Thanksgiving mirage or a sign of sustained strength in the housing market. Mortgage purchase applications are up 12% week over week, though home tours and other early-stage signals have tapered off. Redfin’s Homebuyer Demand Index—a measure of tours and other buying services from Redfin agents—fell to its lowest level in over two months during the week ending November 24, though it’s up 7% year over year. The recent dip in early-stage demand follows two weeks of big upswings; the demand index hit its highest level in nearly a year and a half in mid-November. On the selling side, new listings are up 10.6% year over year, the biggest increase since April. That’s also due partly to the fact that Thanksgiving fell into last year’s comparable period. Like the surge in pending sales, Redfin will know more soon about whether the improvement in new listings is here to stay. For Redfin economists’ takes on the housing market, please visit Redfin’s “From Our Economists” page. Leading indicators Indicators of homebuying demand and activity   Value (if applicable) Recent change Year-over-year change Source Daily average 30-year fixed mortgage rate 6.95% (Nov. 26) Down from 7.08% one week earlier Down from 7.3% Mortgage News Daily Weekly average 30-year fixed mortgage rate 6.81% (week ending Nov. 27) Highest level since July Down from 7.29% Freddie Mac Mortgage-purchase applications (seasonally adjusted)   Up 12% from a week earlier (as of week ending Nov. 22) Up 52% Mortgage Bankers Association Redfin Homebuyer Demand Index (seasonally adjusted)   Down 5% from a month earlier(as of week ending Nov. 24) Up 7%   Redfin Homebuyer Demand Index a measure of tours and other homebuying services from Redfin agents Touring activity   Down 8% from the start of the year (as of Nov. 25)  At this time last year, it was down 42% from the start of 2023 ShowingTime, a home touring technology company Google searches for “home for sale”   Unchanged from a month earlier (as of Nov. 25) Unchanged  Google Trends Key housing-market data U.S. highlights: Four weeks ending Nov. 24, 2024Redfin’s national metrics include data from 400+ U.S. metro areas, and is based on homes listed and/or sold during the period. Weekly housing-market data goes back through 2015. Subject to revision.   Four weeks ending Nov. 24, 2024 Year-over-year change Notes Median sale price $386,625 7% Biggest increase since Sept. 2022 Median asking price $385,975 5.4%   Median monthly mortgage payment $2,578 at a 6.81% mortgage rate 2%   Pending sales 71,773 12.1% Biggest increase since May 2021 (please note that we’re comparing to a period in 2023 that included Thanksgiving) New listings 74,118 10.6% Biggest increase since April(please note that we’re comparing to a period in 2023 that included Thanksgiving) Active listings 1,010,868 12.4% Smallest increase since March Months of supply 3.9 -0.2 pts. 4 to 5 months of supply is considered balanced, with a lower number indicating seller’s market conditions. Share of homes off market in two weeks 29.3% Down from 34%   Median days on market 42 +7 days   Share of homes sold above list price 25% Down from 27%   Average sale-to-list price ratio 98.6% -0.1 pt.   Metro-level highlights: Four weeks ending Nov. 24, 2024Redfin’s metro-level data includes the 50 most populous U.S. metros. Select metros may be excluded from time to time to ensure data accuracy.   Metros with biggest year-over-year increases Metros with biggest year-over-year decreases Notes Median sale price Philadelphia (21.8%)Newark, NJ (17.1%)Miami (13.7%)Cleveland (13.6%)Detroit (12.7%) Tampa, FL (-1%)   Declined in 1 metro Pending sales San Jose, CA (23.7%)New York (23.7%)San Francisco (23.6%)Dallas (22.4%)Las Vegas (20%)  Miami (-6.3%)West Palm Beach, FL (-4.9%)Fort Lauderdale, FL (-3.3%) Declined in 3 metros   New listings San Francisco (31.2%)Washington, D.C. (27.9%)Seattle (25.2%)New York (23.9%)Baltimore (18.6%) Austin, TX (-14.2%)San Antonio (-9.7%)Atlanta (-5.5%)Orlando, FL (-0.1%) Declined in 4 metros To view the full report, including charts, please visit: https://www.redfin.com/news/housing-market-update-homebuying-demand-thanksgiving/

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Streamlining Evictions & Property Management

In this insightful episode of Uncontested Investing, you’ll hear from Barry Owens, CEO and founder of End to End Solutions. With over three decades of experience in the real estate industry, Barry shares how he went from starting in mortgage collections to leading a company that’s transforming eviction management. He explains how End to End Solutions provides landlords with efficient, cost-effective services through a single point of contact for evictions, while sharing insights on leadership, business growth, and adaptability in a changing industry. Whether you’re a seasoned investor or just getting started, this episode will give you actionable takeaways and a fresh perspective on process-driven solutions. Quotables “Continuity of process is the cornerstone of everything we do—it ensures efficiency and success.” “Growth doesn’t come from complacency. We’re always asking, ‘What’s next?’” “Single-family and multifamily investments are entirely different beasts—do your research and stay prepared.” Links End to End Solutions https://www.e2eusa.com/ RCN Capital https://www.rcncapital.com/podcast REI INK https://rei-ink.com/

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Everything You Need to Know About Renting But Didn’t Know to Ask

In this episode of Uncontested Investing, we’re sitting down with Jonas Bordo, CEO of Dwellsy, to explore how his innovative platform is transforming the rental experience for both renters and landlords. Jonas recounts his journey from managing 60,000 rental units to founding Dwellsy, a startup prioritizing transparency and innovation in the rental market. Jonas also introduces exciting new tools like CompIQ, a customizable comparables engine for investors. Whether you’re a renter, landlord, or real estate investor, this episode provides actionable insights and inspiration! Quotables “Renting should be a great experience, but for most people, it’s not. We’re here to change that.” “Your network and mentors shape your success. Always look for opportunities to pay it forward.” “Dwellsy is more than a marketplace; we’re a data company that provides tools to transform how landlords and renters connect.” Links Dwellsy https://www.dwellsy.com CompIQ https://www.dwellsy.com/compiq Everything You Need to Know About Renting But Didn’t Know to Ask https://www.amazon.com/Everything-Nee… RCN Capital https://www.rcncapital.com/podcast REI INK https://rei-ink.com/

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Thriving Through Real Estate Market Shift for Long Term Success

Welcome back to Uncontested Investing! In this episode, I sit down with Rebecca Smith, Vice President of Business Development at Radian Real Estate Management, to explore her incredible 25-year journey in real estate and mortgage finance. Rebecca shares her experience in navigating the ever-evolving industry, including her role in pioneering single-family rental innovations and leading client-driven solutions. Rebecca also gives us a glimpse into her strategies for leadership, fostering relationships, and adapting to shifting market trends. Whether you’re an investor looking to sharpen your edge or just curious about the intricacies of real estate investing, this conversation is packed with actionable insights and inspiration. 5 Key Takeaways from This Episode 1. Adaptability is Crucial Rebecca emphasized the importance of staying flexible and adaptable in the ever-changing real estate market. Whether it’s shifting investment strategies or expanding services, being able to pivot is key to long-term success. 2. Leadership Through Example As VP of Business Development, Rebecca prioritizes leading by example, focusing on her team’s success and fostering client relationships. She highlights the value of collaboration, innovation, and listening to client needs. 3. Diverse Industry Experience Adds Value Rebecca’s extensive background—spanning mortgage servicing, asset management, and client relations—has allowed her to develop a well-rounded perspective, enabling her to craft tailored solutions for investors and clients alike. 4. Customer Service is Key to Building Trust Treating clients’ assets as if they were her own is a cornerstone of Rebecca’s approach. Thoughtful communication, timeliness, and dedication to exceeding expectations set her apart in the industry. 5. Networking Drives Opportunities Rebecca underscores the importance of trade shows and networking for fostering relationships and unlocking new opportunities. Engaging with peers and clients at industry events helps build trust and expand professional reach. Links & Resources Radian Real Estate Management: https://www.radian.com/

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U.S. MORTGAGE LENDING RISES IN Q3 2024 AMID REFINANCING SURGE, BUT REMAINS BELOW HISTORIC HIGHS

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Residential Lending Grows Just 2 Percent Even as Rates Keep Declining; Refinance and Home-Equity Deals Rise While Purchase Loans Decrease ATTOM, a leading curator of land, property data, and real estate analytics, released its third-quarter 2024 U.S. Residential Property Mortgage Origination Report, which shows that 1.67 million mortgages secured by residential property (1 to 4 units) were issued in the United States during the third quarter. That led to modest quarterly and annual increases of 1.9 percent. The growth marked the second straight quarterly gain – a pattern not seen for more than three years. But even as home-mortgage rates dropped close to 6 percent for a 30-year fixed loan by the end of Q3 2024, the increase in business for lenders was far below a spike during the Spring of 2024 and still left total mortgages off by nearly two-thirds from a high point hit in 2021. The latest trend resulted from improvements in refinance and home-equity lending as opposed to more buyers taking out loans. Mortgage rollovers increased 6.9 percent quarterly, to about 588,000, while home-equity packages went up 2.3 percent, to roughly 297,000. Those improvements more than made up for a 1.7 percent decrease in purchase loans, to 782,000, as the annual peak home-buying season wound down and supplies of properties for sale remained tight. Measured monetarily, lenders issued roughly $550 billion worth of residential mortgages in the third quarter of 2024. That was up 2.9 percent from the second quarter of 2024 and 6.6 percent from the third quarter of last year. The differing pattern of increases among various loan types slightly raised the portion of all residential mortgages represented by refinance and home-equity credit lines, while lowering the purchase component. Still, purchase loans remained the most common form of mortgages around the U.S. during the third quarter, comprising almost half. “Mortgage lending rose again in the third quarter, but at a far slower pace than during the Spring of this year when activity spiked nearly 25 percent,” said Rob Barber, CEO at ATTOM. “The latest increase, small as it was, likely came mainly from homeowners trading higher-rate loans they got in 2021 and 2022 for cheaper mortgages resulting from declining mortgage rates. But it looked like the third-quarter rate dip wasn’t as helpful for purchase lending as buyers kept facing elevated prices and low supplies of properties for sale.” The latest lending trends reflected another round of mixed forces affecting home sales and the cost of borrowing. Average 30-year mortgage rates dropped a full percentage point in the third quarter, the kind of decline that can save homeowners thousands of dollars a year on all kinds of loans. But the number of homes for sale remained at some of the lowest levels in the past decade, which continues putting a damper on the market, and purchase loans. Total lending up again but still far below peaksBanks and other lenders issued a total of 1,666,816 residential mortgages in the third quarter of 2024, up from 1,636,073 in the second quarter of 2024 and from 1,635,056 in the third quarter of 2023. Total activity rose for the second quarter in a row – a pattern that hadn’t happened since early in 2021. But the latest figure still remained 60 percent behind a recent high point of 4,165,695 hit in the first quarter of 2021 when average 30-year mortgages rate hovered around 3 percent. A total of $553.1 billion was lent to homeowners and buyers in the third quarter of this year. That was up from $537.5 billion in the prior quarter and from $518.6 billion in the third quarter of 2023, although still less than half the recent peak of $1.3 trillion in 2021. Overall lending activity also rose quarterly and annually in a majority of metropolitan areas around the U.S. with enough data to analyze. The total increased from the second quarter to the third quarter of this year in 125, or 60.4 percent, of the 207 metropolitan statistical areas that had a population of 200,000 or more and at least 1,000 total residential mortgages issued from July through September of 2024. The largest quarterly increases came in Anchorage, AK (total lending up 78.6 percent from the second quarter of 2024 to the third quarter of 2024); Yuma, AZ (up 33.3 percent); Ann Arbor, MI (up 33 percent); Huntington, WV (up 21 percent) and Trenton, NJ (up 20.5 percent). Metro areas with a population of least 1 million that had the biggest increases in total loans from the second to the third quarter of 2024 were Rochester, NY (up 20.1 percent); Detroit, MI (up 14.7 percent); Grand Rapids, MI (up 13.5 percent); San Diego, CA (up 13.2 percent) and Hartford, CT (up 12.7 percent). Metro areas with enough data to analyze where lending went down the most quarterly were Boulder, CO (down 44.3 percent); St. Louis, MO (down 36.5 percent); Jackson, MS (down 25.2 percent); Myrtle Beach, SC (down 20.4 percent) and Springfield, MO (down 19.4 percent) Measured annually, the largest increases in total lending among metro areas with a population of at least 1 million were in Orlando, FL (total lending up 29.3 percent from the third quarter of 2023 to the third quarter of 2024); San Jose, CA (up 28.7 percent); San Diego, CA (up 27.9 percent); Honolulu, HI (up 25.9 percent) and Tucson, AZ (up 17.6 percent). Purchase mortgages decline amid tight market but still make up almost 50 percent of all lendingWhile overall third-quarter lending activity increased, the number of mortgages issued to home buyers was down both quarterly and annually. The count of purchase loans remained only half of where it stood in 2021. The third-quarter total of 782,220 was off from 796,046 in the second quarter of 2024, 814,610 in the third quarter of 2023 and 1.6 million in mid-2021. The latest dollar volume of purchase loans, $306.6 billion, was 2.5 percent less than the $314.3 billion second-quarter level, although still up 0.8 percent from $304.1 billion a year earlier. It sat 43 percent below the 2021 peak Residential purchase-mortgage originations decreased quarterly in 55.1 percent of the 207 metro areas in the report and annually in 56 percent of those markets. The largest quarterly decreases were in Boulder, CO (purchase loans down 50.1 percent from the second quarter of 2024 to the third quarter of 2024); St. Louis, MO (down 42.4 percent); Springfield, MO (down

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