Housing Market and Single-Family Rental Indices
Key Indicators All Showed Improvement in October
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.
Our mission is simple: The NRHC works to educate the public about the benefits of SFR homes and advocate for sensible policies that support the single-family rental market. Our aim is to help preserve and strengthen the availability of SFR properties and to support communities by providing a sought-after form of housing. We also provide members with industry-specific educational opportunities, market research, and other tools to guide them through the ever-evolving housing market landscape.
In keeping with the Data & Analytics theme of this issue of REI INK, below are three indices which show signs of improvement in both the Single-Family Rental industry and the overall housing market.
NAHM/Wells Fargo Housing Market Index
According to the National Association of Homebuilders/Wells Fargo Housing Market Index (HMI), US homebuilder sentiment climbed for a second consecutive month to 43 — reaching a four-month high in October. However, sentiment under 50 still implies that homebuilders’ spirits are dampened. The increase was likely driven by optimism over further declines in mortgage rates and receding inflation, which could boost demand for new homes. The HMI exceeded economists’ expectations of 42, according to Bloomberg.
Key indicators, including future sales outlook over the next six months, present sales, and buyer traffic, all showed improvement in October. 32% of builders reported cutting prices, while 62% used sales incentives. The average reported reduction was 6%.
The index rose in all regions except the South, based on a three-month moving average. The North (51) was the only region above 50.
CoreLogic Single-Family Rental Index
SFR rents rose 2.4% annually in August 2024, according to the CoreLogic Single-Family Rental Index (SFRI). Meanwhile, measured month-over-month rents declined 0.2%. August’s annual growth rate was the slowest since late 2023. Broadly, renters expect 4.5% rent growth over the next 12 months, according to the Fannie Mae National Housing Survey.
Low-tier rents declined by 0.2% — a rarity, as the last low-price tier decline was around the time of the Great Recession. Conversely, high-end rents climbed faster than average at 2.9%.
Among the top 20 metropolitan areas tracked by CoreLogic, Seattle (5.8%), New York City (5.5%), and Washington DC (5.5%) led year-over-year rent growth. Sun Belt markets
Austin (-2.3%), Phoenix (0.0%), and Orlando (0.2%) lagged behind the rest of the pack. Despite the slowdown, Phoenix and Orlando are still up 38% and 41%, respectively, from four years ago.
Fannie Mae’s Home Price Index
Fannie Mae reported home prices increased 5.9% over the past year. According to Fannie Mae’s Home Price Index, single-family home prices increased 5.9% from the third quarter of 2023 to the third quarter of 2024, a decline from the previous quarter’s annual increase of 6.4%.
Government Affairs
California Governor, Gavin Newsom, recently signed legislation impacting rental property owners in the state. Assembly Bill 2493 prohibits property owners from charging prospective tenants a screening fee to applicants not selected for a vacancy; and Assembly Bill 2801 requires property owners to provide photographic evidence of necessary repairs and proof they were completed before accessing security deposit funds.
Industry Leaders Conference
And in closing, I would like to invite you to join us at NRHC’s Industry Leaders Conference, the single-family rental home industry’s most important annual event. The event will be April 6-9, 2025, in Orlando, FL. Take advantage of the many opportunities to participate and hear from owner-operator executives and other experts in the SFR and BTR communities.
Make valuable connections and network with your industry peers during a variety of engaging general sessions and be a part of the discussions on build-to-rent, housing policy initiatives, operational innovations, and advancements in technology.
