REI INK

Perspective

The State of the Market

Funding and Alternative Lending Strategies By Jennifer McGuinness-Lubbert To say that the last 18 months have been “quite a ride”, would be an understatement. The Fed raised the Fed Funds rate target at its fastest pace in history. During the first half of 2022, the central bank raised rates three times, ramping up the size of the increase each time, culminating in June’s aggressive 75 basis point hike. Before June, the Fed hadn’t raised its flagship policy rate by 75 basis points in any single meeting since 1994. The Fed continued its aggressive battle against inflation over the course of the year, with three additional 75 basis point increases during the second half of 2022. Then in December, the Fed tacked on one more but this time, slightly less aggressive, with a rate hike of 50 basis points. Were we seeing light at the end of the tunnel? The federal funds rate ended 2022, 425-450 basis points up from ZERO at the start of the calendar year. With most of the financial and economic research world believing that the central bank will leave short-term interest rates in the current 5.25%-5.50% range at the close of its Sept. 19-20, 2023, meeting, the main unknown is how policymakers will reshape their “stale” forecasts from three months ago, as they were shown to be, at times, materially incorrect. Economic data since the Fed’s mid-June meeting, has persistently surprised to the upside, hence, the Fed will need to go “back to the drawing board,” as their outlooks saw declines, rising unemployment and only modest improvements in inflation. Many are predicting that given the (at times) “prettier” picture, that the Fed will not raise the rates further — but speculate that they are not yet ready to indicate that they are “done” from a tightening perspective. Declaring that they have completed their cycle would likely lead to a significant easing of financial conditions. Personally, I predict that we will see one additional 25 basis point increase. By the time you are reading this article, we will know the answer. Easing financial conditions could mean higher stock prices or lower bond yields, which could stimulate spending and borrowing and trigger an increase in inflation, which is what the Fed is trying to avoid. In my humble opinion, this means the majority of Fed policymakers will probably still consider a year-end policy rate of 5.6% to be where we should be, which is one quarter point above where it is now. Although there are still some economists that believe that the Fed will raise rates again toward the end of the year, many other economists also expect Fed policymakers to pass fewer rate cuts next year. Financial markets are currently pricing for rates to fall to 4.4% by the end of 2024 and 3.8% by the end of 2025. The September meeting will be very telling on this front. Generally, all of the economists and researchers expect to see substantial “upgrades” to the initial forecasts they presented, as despite the 525 basis points of interest-rate hikes over the last 18 months, the U.S. economy expanded at about a 2% pace in the first half of this year, and may be growing even faster in the current quarter. There may even be a glimpse from the Fed that they are more optimistic regarding the labor market, for example, as the unemployment rate leapt to 3.8% in August, its highest since before the Fed began raising rates. But people losing jobs was not the driver of this increase — it was the number of people looking for work, which is a symbol of strength more than weakness. Last summer, inflation at its peak was 7% and has been falling rapidly this year to 3.3% in July, only slightly higher than the 3.2% rate the Fed predicted it would see at the end of this year. Where are mortgage rates today? The national average 30-year fixed mortgage rocketed past 7% in mid-August, reaching a 2023 high of 7.23%. As of September 14, the average 30-year fixed mortgage rate stood at 7.18%, according to Freddie Mac. Despite these high mortgage rates and home prices, the market remains as competitive as ever, thanks to the fact that demand levels are still currently surpassing the lack of inventory available and because homeowners who locked in low interest rates are not selling their homes. Many point to these features as evidence of an affordability crisis and blame it for why certain people are not so quick to go out a buy a home. Today’s mortgage spread, which is the difference between the 10-year Treasury bond yield and the 30-year fixed rate mortgage—is approximately 300 basis points. Historically, the spread should be between 150 and 200 basis points. Lawrence Yun, the chief economist of the National Association of Realtors, predicts that spreads will begin to normalize and that mortgage rates will fall to around 6% by the end of 2023. I’m not sure that I agree that we will get to 6% by the end of 2023, but I do believe we will see rates begin to come down next year and begin to stabilize this year. According to recent data, the median new home sales price in the United States that dipped to a 2023 low of $417,200 in April, increased to $436,700 by July. Year-over-year new home sales have also increased, surging by 31.5%, even as existing home sales continue to sag or increase. Finally, single-family construction starts increased 6.7% following a decline in June and applications for building permits rose 0.6% from the previous month. Let’s now assess the opportunity While housing is regional and trends differ by location, the East Coast and Midwest (for example, 4%+ in Chicago and Clevland) are seeing strength in their home prices, while on the West Coast, places like Nevada (-8% in Vegas) are seeing a decline. Right now, overall home prices in 2023 appear to be more than just a seasonal increase. Also, we

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Incentivizing Residential Leasebacks

A Democratic Solution for Real Estate Investment By Danny Kattan The residential real estate market finds itself in the crosshairs of government scrutiny. The government is blaming residential investors for purchasing properties for rental purposes. Officials argue that these properties should be obtained by those needing occupancy. However, this perspective oversimplifies a complex system and overlooks some significant contributions investors make to the stability of the housing market, the efficient supply of rental properties and the broader financial ecosystem. In 2008, I, along with my partners, began modestly purchasing single-family properties in South Florida. Over time, we expanded our portfolio and our operations grew organically. We owned and managed 400 single-family and 400 small multi-family properties, which we eventually sold in 2018. Throughout this journey, it became increasingly clear to me that real estate investors were the glue holding the economy together. Without their involvement, hundreds of thousands of properties would have remained vacant, leading to blight in neighborhoods. Attacking SFR investors can have unintended consequences during the next economic downturn. Residential Investors are Key In truth, residential investors are the bedrock of a robust housing system. Not everyone is able to or even desires to purchase a home. Some individuals, by circumstance or choice, prefer the flexibility renting provides. It is crucial to maintain a vibrant residential rental market as it caters to a diverse range of individuals at various life stages. This includes students seeking affordable living options, professionals in transitional phases, newlywed couples establishing their first home together and retirees desiring a maintenance-free lifestyle. Each of these groups, and many others, rely on the flexibility and convenience that rental properties provide, underscoring the importance of a robust rental market in our society. It is the investment by others in residential properties that facilitates this choice. It is important to acknowledge that not everyone opts for investing in the financial markets. Many individuals perceive real estate as a more tangible and stable investment. “Demonizing” investment in residential real estate could inadvertently push more people towards the potentially volatile financial markets. Moreover, real estate investment is a vital pathway for wealth creation. Numerous individuals and families have amassed substantial wealth through the acquisition of rental properties. Discouraging this form of investment not only hampers potential investors but also diminishes the overall housing supply. This could inadvertently escalate rental costs, affecting those who rely on rental properties for their housing needs. Fostering a healthy environment for residential real estate investment is crucial for both the stability of our economy and the well-being of diverse societal groups. Residential Leasebacks The drive to convert renters into homeowners has been a recurring theme in public policy discussions. While this is an admirable goal, it cannot be the sole focus of our efforts to improve the housing market. To create a more stable and diverse real estate economy, I believe that the key is to actively encourage ‘mom-and-pop’ investors to invest in rental properties. One of the ways to encourage participation in the market while maintaining stability and promoting increased housing supply is through incentivizing residential leasebacks. A residential leaseback is an agreement where the seller of a home leases it back from the buyer for a specified period after the sale. I believe that the market should embrace residential leasebacks as this category can be a catalyst for change in the market. A traditional real estate investment model might be daunting for a new investor, given the potential issues related to property management and tenant relations. Residential leasebacks offer an alternative that could attract first-time investors to the real estate market. Leasebacks could be the gateway to real estate investing for financially capable individuals spooked by the complexities of traditional property investments. This mechanism has several benefits for investors while offering a lifeline for homeowners who might be hesitant to sell their properties due to uncertainties about their next dwelling place. With residential leasebacks, homeowners can unlock the equity in their properties without uprooting their lives. This influx of funds can be directed towards family needs, starting a business, or other financial goals, effectively pushing a ripple effect on the broader economy. Furthermore, residential leasebacks tend to create more conscientious tenants. After all, who would treat a property better than those who once owned it? This aspect significantly reduces operational expenses related to property maintenance and potential damages. Over time, these savings can translate into lower rental costs, providing relief to the renter population while making the housing market more accessible. Many individuals hesitate to invest in rental properties out of fear of potential tenant issues. Yet, if we can assuage these concerns and promote small-scale investment, we can simultaneously increase housing inventory and reduce rental costs, benefiting both renters and investors. The beauty of residential leasebacks lies in their versatility. They can solve several societal challenges, such as providing financial relief for retirees, helping individuals navigate through a divorce or simply offering a much-needed cash injection for those in need. From an Environmental, Social, and Governance (ESG) perspective, residential leasebacks can contribute positively to societal welfare. Environmentally, they promote efficient use of existing housing stock, reducing the pressure to build new properties. Socially, they offer homeowners an option to unlock equity. In essence, residential leasebacks create a win-win scenario. They offer homeowners financial flexibility while providing investors with a more manageable and potentially less problematic route to property investment. Conclusion If the government truly wishes to create a more democratic real estate system that benefits all stakeholders, incentivizing residential leasebacks should be a part of the strategy. By doing so, we can attract smaller, first-time investors to the market, increase the housing supply, and create a more balanced, equitable, and resilient housing ecosystem. The residential investment market should not be an adversary but an essential partner in maintaining the health of the housing system. It is time to shift our perception and recognize the value small investors bring to the table. Promoting residential leasebacks can be a step in that direction.

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Increasing the Inventory of Affordable Housing

Working Together to Make a Difference By Robert Rakowski HomeVestors®, the “We Buy Ugly Houses®” company, is playing an important role in addressing the housing inventory crunch with the current U.S. housing Inventory at 51% of pre-pandemic levels. This is especially true for first-time buyers. Potential homebuyers are seeing fewer fresh listings as sellers have stepped back even further. In April, new sales listings decreased, defying normal seasonal trends. According to Zillow, total inventory is up just 3% annually and while buyers are still scooping up what they can find, they are hindered by a lack of choices. Massive home price appreciation, combined with mortgage rates that doubled in 2022, has made both down payments and monthly mortgage costs much tougher to afford. Several forecasters expect affordability to improve slightly over the next year, but high demand for homes and stubbornly low supply will prevent a return to pre-pandemic norms.  A report recently released by ServiceLink shows that complicated market conditions are leading some homebuyers to abandon the homebuying process. For example, their study cites that almost half of the respondents surveyed considered buying a new home in the past 12 months, but ultimately decided against it. And over 50% of those respondents said their buying options were too expensive. These percentages are considerably higher than the studies cited in 2022. In real estate, for every action there is always a reaction. When supply is lower, demand is usually driven up; when supply increases prices are likely to lower. As months of supply for existing home sales remain near all-time lows, contributing additional and improved housing inventory enables more low-and-moderate income and first-time homebuyers to access affordable housing. The average sales price for a newly built home has climbed to $543,600, but the average resale price of houses from a “We Buy Ugly Houses” franchisee is around $254,000. At HomeVestors, when independent business owners buy and revitalize houses, they actually increase the inventory of affordable housing. On average it takes less than 120 days for franchises to reintroduce rehabbed houses to their local markets as desirable properties for new buyers. Many of the houses that they buy would not typically qualify for conventional or FHA/VA financing due to their poor condition. The time and work of the franchisees, which includes hiring subcontractors, paying for the subcontractors, buying materials, etc., makes it possible for these houses to qualify for a mortgage. Additionally, they pay all normal closing costs, do not charge real estate commissions, and the sellers don’t have to worry about cleaning and showings. When a franchisee buys a house, closings sometimes occur in as little as three weeks. Their offers are based on the money invested in repairing the property and the money sellers save on associated transactional costs. The independent business owners do more than their We Buy Ugly Houses motto suggests. They also help people with Solutions for Ugly Situations®, be they tax liens, probate, inherited homes, etc. Whatever the situation, issues are navigated face-to-face with the seller and not merely online. Since HomeVestors’ founding, their franchises have purchased over 140,000 homes, the vast majority of which have returned to market as “mortgage-eligible,” via a national network of over 1,100 franchises across the continental United States. However, solving both the housing affordability and inventory issues is an arduous task. And it will take time to fix a situation that has been spiraling out of control for years. The good news is that the HomeVestors independent business owners are some of the best and brightest leaders in the real estate community. By everyone working together, investment companies, lenders, builders, service providers, etc., the inventory crunch and affordable housing crisis can be solved.

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Turning a Profit in the Post-Pandemic Housing Paradox

2023 Will be All About Disappointment…and Opportunity By Bruce McNeilage When the New Year rolled around at midnight on January 1, 2023, we entered what could be one of the most opportunity-filled years for real estate investors in more than a decade. On the other hand, we also entered one of the most treacherous years in housing that we have seen in over a decade. Now that the country appears to be emerging on the other side of the pandemic, the only certainty among most investors and analysts seems to be that the euphoria is about to end. Naturally, this is a source of great concern for some people and great excitement for others. The reality of the situation is that there is always opportunity in real estate, but only if you are looking for that opportunity in the right places. Big Changes are Coming, and There is No Easy Solution At the end of the first quarter of 2023, the shifting market was already starting to emerge. For starters, what was working like a charm in 2020 and 2021 when it came to flipping houses had started to stall out in 2022 and came nearly full stop for many investors in 2023 thanks to rising interest rates and the cost of labor. Of course, the cost of materials was an ongoing concern throughout. Nevertheless, when you could borrow money at around 3% interest, flipping was a great business model. Now, however, that interest rates are hovering closer to 7%, it is not a good business model. In my business of building homes to rent and for retail sale, my funding costs have nearly doubled over the past 16 months. Something has to make up for those new costs, and investors will be limited in how they can reduce and accommodate new budget constraints. For example, for investors who own rental properties, 2023 brings rising taxes, rising insurance rates, rising costs of materials, and rising costs of labor. While rents are rising as well, it is unrealistic to simply double rents to make up the difference, which is what most investors would need to do in order to continue “business as usual” in 2023. Tenants cannot handle that kind of rate hike nor should they be expected to. Rents already rose last year by between 10-20% in most areas of the country. In my rental developments, we are hoping to lower rents slightly to keep our tenants housed. This might mean our revenues are lower — possibly around 5 % — but since they spiked in the two previous years, we expect to see positive, solid averages and reliable, long-term tenants in response to this strategy. As the cost of acquiring a home rises for retail buyers as well, investors will be well-served to pivot from owning traditional rentals to exploring creative strategies like rent-to-own. While it may be increasingly difficult for residents to purchase homes via the traditional route of a 30-year, fixed-rate mortgage, it will not become less appealing to own a home rather than rent one. In fact, about nine out of 10 millennials and “zoomers” who currently rent say they want to own their own homes — a far cry from forecasts in the mid-2000s that predicted these post-housing-crash young professionals would be content to rent their entire lives. These generations are typically quite comfortable thinking outside the traditional home-buying box, making them excellent candidates for rent-to-own models and, as an added bonus, they are usually reliable tenants as well. Breaking Down the “Affordability vs. Reset” Conundrum Two terms we are hearing more than ever in real estate are the words “affordability” and “reset.” First, the discussion deals with the topic of affordability. You tend to hear that in many states, only about half of the population has any chance at all of being able to buy and afford a home. Then, you learn that less than half of young (younger than 30) and young-ish (between 30 and 40) adults currently own their own homes even though roughly two-thirds of all Americans are homeowners. Then, the lecture continues in this vein, addressing the legitimate concern that rising interest rates, stagnating wages, and rampant inflation are going to price many of these young professionals right out of homeownership until they are well into middle age. The conclusion is always the same: The nation needs more affordable housing. The need for affordable housing established, the speaker then shifts topics. Now, they tell you about how housing is headed for a “reset” in the post-pandemic years. This is likely accurate. Since 2010, if an investor was reasonably active and ran their numbers with any degree of care at all, they could generate some fat margins on their deals. Around the time the market might normally have started correcting in 2019 or 2020, the pandemic “accelerated” the market into an unprecedented mini-boom fueled by government intervention and buyers’ fear of the unknown (and apartment living). Throughout 2020, 2021, and the first half of 2022, homes that went on the market in the southeast, for example, were sold within a day and tended to have multiple offers within the first few hours of listing. Then, somewhere around the end of the summer, things shifted. The bottom did not fall out of the market, but suddenly the only people making full-price offers were the i-buyers, and they were not necessarily moving terribly fast. When an algorithm is the only potential buyer offering you full price, you immediately know two things: Something in the market is changing or the software has not yet spotted the change. Of course, today there are far fewer algorithm-driven buying systems operating in the housing market. Investors will soon discover the coming “reset” is not going to be like 2008. Today’s market, with tighter lending standards, higher housing prices, historically low inventory, and as-yet unpredictable rates of inflation, is likely to experience a long, slow decline in some of the most expensive markets, a slight slide followed

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the “Lake Next Door” Affects Your Property Values

What Happens When Water-Related Value Goes Down the Drain? By Dana Nutt Imagine this scenario: You own a wonderful cabin near a crystal-clear, blue-ribbon trout stream. Just a couple of miles up the road, there is a picturesque lake that is home to an incredible variety of wildlife, including turtles, beavers, loons, frogs, and osprey. Your riverside cabin is the stuff that sportsmen’s and outdoorsmen’s dreams are made of, and when you are not using it personally, you rent it out to others who love the outdoors as much as you do. This cabin means so much to you because of the wonderful family memories you have made there and because of its value. You know that when you are ready to retire, the equity in that property is going to play a big role in your financial security. Then, you find out something terrible. You learn that the state government’s Department of Natural Resources (DNR) has decided to remove a dam that sits upstream from your cabin. The agency says its sorry, but that the dam is going to need some repairs and the state believes it will be less expensive to simply “drain down” the beautiful reservoir that has stood near your home for more than 80 years than to make the repairs. This process, by the way, will fill your own riverfront property with sediment, could completely eliminate the fantastic fishing, will certainly result in the departure and death of much of the wildlife (including federally protected nesting loons), and will reduce the appeal of your cabin to short-term renters to nearly zero, which means its value to your financial freedom is heading out the window. For that matter, this catastrophe is going to break your own heart and eliminate your cabin’s appeal for you, as well. Sound like a nightmare? It is. Worse, it is a nightmare that hundreds of property owners face right now in northern Michigan, where the state is laying out a process for draining down a longstanding, manmade reservoir called Cornwall Flooding and removing the dam that created the reservoir back in the 1960s. This process will not only eliminate the reservoir; it will permanently alter the face of the area downstream as well. What’s Wrong with the Dam? The DNR says the dam has to go due to a recent assessment indicating its condition needs work and a failure could cause “serious damage to inhabited homes or infrastructure downstream … where danger to individuals exists with the potential for loss of life.” The fastest solution, and one that is currently under discussion, would be to lower the level of Cornwall Flooding so that the dam would be under less pressure, then reevaluate the total removal of the dam. However, repairs will be far more expensive than removal, and the state has a limited budget. Casey Nutt, a local business owner who lives in nearby Afton, Michigan, and grew up spending all four seasons outdoors in the Cornwall Flooding area, says he and many others believe there is a way to draw down the reservoir and get the repairs made instead of removing the dam entirely. Nutt emphasized, “There are ways to do those repairs while the lake and the wildlife are unchanged and unaffected. No one wants a dam failure. We just want to preserve this incredible spot on earth.” Nutt said he believes the DNR and the many people who love Cornwall Flooding and the forest around it can work together to find a solution that does not have to mean the end of the treasured outdoor area. “This area is very pristine, and there are huge numbers of people who use and love this area,” he said. “We are hoping to see if there is some way to bring the cost of repairs down or locate additional money.” Curtis Goldsborough, another local businessowner, avid outdoorsman, and organizer for the Save Cornwall group, said that three state politicians, in particular, have taken up the cause of dam repair in recent months. Because of the rising costs of construction since the original project was bid in 2020, it appears likely that the cost of repairs could climb as high as $1.5 million. Goldsborough explained there are multiple possible routes to raising that money, noting that the state already has about $300,000 in a fund allocated to the dam. Funds could come from a 2024 DNR budget line item. State representative Ken Borton (R) has submitted a 2024 budget line item that would cover the estimated $1.5 million needed to cover the cost of dam repair. “We have to remember that the budget still has to be debated, trimmed, and approved, but we just want to thank the representative for listening,” Goldsborough said. State representative Cam Cavitt (R) and state senator John Damoose (R) are taking a different route, submitting the project for consideration for the 2023 supplemental appropriations bill. This type of bill is used when Michigan has a budget surplus; this year there is a surplus of about $9.2 billion. “We are so grateful to both of these representatives for listening to our collective voice and taking action,” Goldsborough added. Water Policy Affects Everyone At first glance, property owners might think dam removal only affects people living on the water. However, water policy plays a crucial role in home values for all proximal properties, and since the advent of COVID-19, “proximal” has taken on a new meaning. Some studies indicate that houses as far away as four hours from outdoor recreation locations like beaches and lakes gained equity because they represented a drivable option for locked-down individuals. While some of that value may have fallen off as pandemic restrictions diminished, studies dating back as far as the 1980s and published as recently as last year indicate that some proximity to water easily adds between 5% and 30%. Whether you invest in northern Michigan, where many homes are within a few hours’ drive of the Great Lakes, or in any

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The Single-Family Rental Home Industry Has Never Been More Important

Sound Government Policies Are Needed to Create Favorable Market Conditions By David Howard As members of the National Rental Home Council (NRHC) prepare to gather in Nashville this month for the annual SFR Industry Leaders Conference, intensifying headwinds continue to swirl around the global economy. Rising interest rates, a weight on the housing market for the better part of the past year, have now started to curtail growth across a wider swath of the economy. Most concerning perhaps is the impact of higher rates on the stability of the banking sector, with a number of recent high-profile bank failures sparking concerns for the overall health of both U.S. and global financial markets. All of this is playing out amidst the backdrop of slowing economic growth that many forecasters claim is an indication of more difficult times ahead. Given the current landscape, the role of the rental housing market, and single-family rental housing in particular, has arguably never been more important than it is today. Demand for housing, even in a rising rate environment, remains solid, with both home price and rental rate appreciation showing positive growth. Admittedly, this growth is down from the historically high levels of the past year, but it remains positive nonetheless. Housing supply, on the other hand, continues to be a challenge. A recent report by Realtor.com showed the gap between new home construction and household formation increased to 6.5 million units between 2012 and 2022. The Supply and Demand Dilemma On its own, the mismatch between supply and demand would be enough of a challenge for anyone considering a home purchase. However, with interest rates on the rise, the cost to finance a home today adds another layer of complexity for consumers in the market for a potential home purchase. According to research from John Burns Real Estate Consulting, the average cost of a monthly payment to rent a single-family home is now $850 less than the cost to own a single-family home, the biggest difference in cost since the year 2000. All of this is a way of saying, America needs more housing, of all kinds — owner-occupied and rental. The most visible consequence of a housing market burdened by ongoing supply challenges is, quite simply, there are fewer options available to meet the needs of Americans in search of quality housing. More broadly, underproduction acts as a clear, and concerning, drag on homeownership and owner-occupied housing. However, supply shortages are felt throughout the housing ecosystem, impacting virtually every sector of the market, including single-family rental homes. The single-family rental home industry has historically accounted for approximately 40% of America’s rental housing market, providing access to quality, affordably priced housing for more than 16 million households in neighborhoods with proximity to schools, employment centers, and transportation corridors. Providers of single-family rental homes — large and small — play a critical role in offering families and individuals a greater range of housing options, at a time when it is most needed. According to Harvard University’s Joint Center for Housing Studies, the number of renter households increased by 870,000 during the COVID pandemic. The Joint Center’s report, America’s Rental Housing 2022, identified five reasons for the surge in rental housing:  »         Large number of millennials moving through their 20s and 30s: ages where renting is most common;  »         Rapid growth of older renters: baby boomers aging into their 60s and 70s;  »         Sharp rise in rentership between 2009 and 2019 for younger and middle-aged households: signaling delayed transitions to homeownership;  »         The growing popularity of renting among older households: contributing to increases in both the number and share of higher-income renters;  »         The increasing diversity of U.S. households: lifting demand for rental housing. While these factors were likely present before the COVID health crisis, there’s no question the pandemic contributed to a rise in demand for single-family rental homes. According to the NRHC/John Burns Real Estate Consulting Single-Family Rental Market Index (SFRMI) report from the third quarter of 2020, nearly 60% of new single-family rental home residents relocated from urban multifamily properties. With a greater share of the American workforce spending more time working from home, either permanently or part-time, the desire for extra space has also contributed to the demand for single-family rental homes, 65% of which contain three or more bedrooms (compared to just 11% of multifamily units). Finally, there is the great migration: in 2020, one in 10 Americans moved to a new market. Meeting the Challenge For these reasons, there is arguably a greater need for single-family rental housing in the U.S. than there has been in decades. However, data show ongoing housing supply pressure has challenged the ability of the single-family rental home market to meet that demand. An analysis of housing data from the Annual Social Economic Supplement of the Current Population Survey, published by the U.S. Census Bureau, reveals even though demand for single-family rental homes increased during the decade 2011–2021, the share of single-family rental homes within both the single-family and rental housing markets declined. To meet the need for single-family rental housing, NRHC members are investing in local staff, hiring local contractors and business partners, and bringing property management expertise to local markets all to ensure a positive experience for residents and families who choose a single-family rental home lifestyle. As evidence, in 2021 NRHC members invested nearly $2 billion in home renovations, upgrades, and other property-level operations while employing more than 8,000 local businesses and contractors in markets across the country. Additionally, many NRHC members support residents on their path toward homeownership by reporting on-time rent payments to credit agencies and providing access to financial literacy programs. The ongoing development and maturation of the single-family rental home industry is focused on providing a viable source of stabilized long-term rental housing responsive to the needs and lifestyle preferences of today’s housing consumer. To the extent that we are able to provide more housing, we are better positioned to meet those needs. Perhaps the most direct indication

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