REI INK

Rently

Leading the Way in Self-Guided Touring by Carole VanSickle Ellis It’s a tough world out there for rental owners and residents, and at no point is it tougher than when the two parties are seeking each other but have not yet met. The peril does not so much lie in the difficulty in finding affordable housing or locating a unit that meets a household’s needs (although those activities can be challenging) but, instead, in actually managing to lease a real home or apartment. Thanks to skyrocketing rental fraud that targets asset owners, managers, and residents alike, the rental landscape has become more challenging than ever. According to the FBI, incidences of single-family rental fraud began rising in the wake of the COVID-19 pandemic. There was a 27% jump in reported cases between 2021 and 2022, and, in 2024, the FBI Crime Complaint Center (IC3) announced the cumulative reported losses related to real estate fraud had reached a sum in excess of $145 million. The center noted actual losses were probably much higher since many real estate scams go unreported due to victim embarrassment. The results of this burgeoning, troublesome trend run the gamut from rising rental rates to increased insurance costs and permanent damage to innocent victims and corporate brands that get caught in the crossfire when scammers successfully defraud victims using the landlord’s name or real assets. Rently, a self-touring smart-home technology company that combines hardware and software solutions to optimize leasing efficiency for landlords, believes its platform represents the best solution to this emerging threat. Company co-founder Clark Li, who currently serves as CTO and works on smart-home and smart-building solutions, said his company, which was created to improve convenience for would-be renters, now holds the cure for the “pain points” both owners and would-be renters experience when it comes to securely accessing units and keeping the entire transaction clear of con artists and fraud. “Merrick Lackner, our CEO and my co-founder, and I drew from our own difficulties related to housing searches when we started the company in 2011,” Li said. “We wanted to create a system that would immediately answer a potential resident’s two main questions: ‘Is it available?’ and ‘When can I see it?’” The result of their collaboration would be one of the original self-touring platforms and make Rently what Li describes as “pioneers [and] the undisputed leader in self-guided touring.” Thanks to the company’s head start in the space, Rently is uniquely equipped to combat the rising spread of issues surrounding security and rental fraud, noted director of business operations Sahil Farooqi. Farooqi joined Rently in 2017, when the company was expanding into smart-home technology designed to protect owners and residents while providing appropriate and convenient access to units when necessary. “It was so important, especially during the pandemic and continuing today, that good people continue to have the ability to view homes and rent properties,” Farooqi said. “We create systems that enable good actors to access properties while the bad actors are detected early, at the top of the ‘funnel,’ and owners and residents remain secure and protected.” “A Whole Array of Scams” Threaten Single-Family Real Estate Although both single-and multifamily real estate are under attack from increasingly sophisticated scammers, the single-family space, in particular, has reeled under an assault of elaborate hoaxes and cons that results in millions of lost revenue, the total annihilation of life savings in some cases, and the destruction of trusted corporate brands. “There is a whole array of scams in the SFR space,” Farooqi observed. “We see social engineering, wired money, vandalism, trespassing, tactical targeting of vulnerable and gullible potential renters, fake listings, and manipulation.” He explained the biggest weak point for many asset owners lies in the ability of scammers to create relationships with would-be tenants by posing as those owners or representatives of the owners and establishing trust before springing the trap and requesting irreversible, wire-transferred “deposits” or even installing tenants in homes. In the latter case, tenants often believe they are legitimately renting the space only to learn they are squatting illegally and must be evicted. This can lead to intense resentment of the owners and property managers as well as losses in income and monies paid. Rently, Farooqi said, stops this entire vicious cycle early in its tracks through verification methods that confirm for parties on both sides of the leasing equation that the other party is legitimate. “We provide property managers with I.D. verification and selfie verification technology,” he explained. These types of real-time verifications prevent the sorts of unauthorized access that can occur with traditional lockboxes, which may be broken and removed or “decoded” for unauthorized entry. Rently recently debuted another security feature that cross references with the Department of Motor Vehicles. The company prevents scammers from taking advantage of redundancy in tours and visits to break into additional properties by requiring real-time check-ins at each property. A selfie-check, for example, must show the person and the property they are entering and match with the documented appearance of the individual who scheduled the tour. Only then will the system permit entry. Of course, Farooqi conceded, “fraudsters are always evolving their tactics.” To address this issue, the Rently team developed a machine learning model to evolve right along with the most advanced scams. “Our security team manages this risk-scoring model and conducts a review on a daily basis to enhance the model,” he said. “It takes into consideration changing tactics of scammers and guides us toward places they might try to enter the platform. We detect the attempt proactively and stop them from entering the property.” Revisiting the Multifamily Angle As Rently’s prowess at preventing SFR fraud continued to strengthen and grow, more multifamily operators expressed interest in developing their own custom systems that would operate on the same principles. To assist in this, Jared East, Rently’s vice president of product & software, and his team began working on options that would meet large operators’ needs. “There are a lot

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Wichita, Kansas

A Window of Opportunity Could be Closing in the “Air Capital of the World” by Carole VanSickle Ellis Wichita, Kansas, has been a destination from its inception. Located near the confluence of the Arkansas and Little Arkansas Rivers, Wichita is named for the Native American tribe that inhabited the area before Spanish explorer Francisco Vasquez de Coronado explored the area in the mid-1550s. Ultimately, the region was acquired by the United States as part of the Louisiana Purchase, and traders began to flock to the area and build small log structures to serve as hotels, a post office, and, eventually, homes for permanent residents. By 1872, the city had been nicknamed “Cowtown” thanks to the many cattle drives that ended there when the herds were taken onto newly built railways, and it also emerged as an entertainment destination thanks to a proliferation of saloons and brothels combined with a dearth of law enforcement. By the late 1800s, Wichita was firmly on the map. Today, of course, Wichita plays up other elements of the municipality than brothels and “light” legal adherence. The Wichita of 2024 proudly claims the title, “Air Capital of the World,” and the city is host to more modern business opportunities, including a vast aviation and aeronautical engineering sector, a substantial aircraft manufacturing sector, and a thriving healthcare industry. Wichita is also the birthplace of a number of iconic fast-food restaurants, including White Castle, Pizza Hut, and Freddy’s Frozen Custard. Not surprisingly, however, the biggest points of pride for local chambers of commerce are the more than 115 aerospace and aerospace-related manufacturers, including Textron Aviation (Cessna and Beechcraft), Spirit AeroSystems, Bombardier Learjet, and Airbus. The chamber also notes the presence of “a comprehensive network of over 450 precision machine shops, tool and die shops, and other aerospace subcontractors.” A “Return to Old Normal” The city’s strong economy is one factor contributing significantly to what Stan Longhofer, director for the Center for Real Estate at Wichita State University, describes as the market “coming full circle…to where we were 20 years ago [in 2004].” He argues that after the housing crisis and financial meltdown in the mid-2000s, the Great Recession and the COVID-19 pandemic wreaked havoc on traditional models and market behaviors. This had a wildly detrimental effect on home construction, which ultimately led to the outsized demand and appreciation experienced nationwide during the global pandemic. For 2025, Longhofer and his research team predicted, “The broad theme…is something of a return to the old normal, and by that, I mean a place we haven’t been in maybe 20 years.” Longhofer explained in his October 2024 forecast at Wichita State University, “It’s been a very unusual two decades.” He continued, describing the years following the financial crisis as “an absolute cratering of new-home construction” during which levels hit their lowest point since World War II. Despite pre-housing crash overbuilding, “[new-home construction in Wichita] never recovered,” Longhofer said. However, with the pandemic largely in the rearview mirror and, thus, no longer threatening the manufacturing bases in Wichita, a slightly softening housing inventory, and relatively affordable housing costs, the city is poised to be both attractive and affordable in 2025. Unlike some markets where inventory volumes are rising so fast the appreciation from the past few years is at risk, in Wichita, it appears demand and a slow increase in listing volume are balancing each other out to keep home values strong. According to one local agent, this trend has been in the making for about 18 months already. “The number of homes that are for sale has increased, but slowly,” he told local news outlet 12News. “Home values are still increasing.” Although home price gains were more modest in 2024 (8%) compared to previous years, which posted double-digit appreciation (11% in 2023 and 2022, nearly 15% in 2021), they remain solid and are expected to come close to these gains again in 2025. With Low Home-Flipping Rates, Wichita Investors Focus on Buy-and-Hold All this appreciation has not led to as much fix-and-flip activity in Wichita as one might expect. In fact, according to ATTOM Data’s report on flipping activity released in 2023, just 5% of transactions in Wichita were home flips. This is one of the lowest rates in the country. Real estate investors in the area today report profit margins “are lower now than five years ago,” as local landlord Mike Heldstab told NPR this past August. Heldstab made headlines at the time for the longevity of his tenant relationships. Some have maintained leases with him for more than a decade. Heldstab’s model of rehabbing and then renting out properties often below market rate (a model he developed after finding the fix-and-flip model was not as effective as he had hoped) has worked for him, but he acknowledged he is also not currently raising rents as much as he said he “probably should,” explaining, “It’s tough for anyone to afford [rental rate increases] when their incomes maybe haven’t gone up.” Rental availability, like housing availability in general, is somewhat precarious in the Wichita area. According to HUD’s October 2024 “Comprehensive Housing Market Analysis Wichita, KS,” the rental vacancy rate in the area is “balanced” at just over 10%, but rental rates are increasing along with demand. HUD estimated there would be a demand for more than 3,100 new rental units in the coming year, but only 2,100 are currently under construction. For-sale housing inventory is likely to undergo starker shortages, with HUD estimating a pending demand for roughly 5,100 units and only 1,400 under construction. Despite this, HUD analysts noted, “[Wichita] remains among the most affordable areas to buy a home in the nation.” The area remains the 59th most-affordable market in the country out of 241 areas ranked. Local government is currently working with investors to incentivize the creation of new housing as well via the Wichita HOME Investments Partnerships Program and the Housing Development Loan Program (HDLP). These grants are intended to support development in areas classified as

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The Real Estate Question: 2025

Investors Must Leverage the Data at Their Disposal by Andy Bates Not quite the dynamic environment seen in recent years since the pandemic, 2024 has maintained its own brand of tension for those involved in real estate. Throughout the year, uncertainty has been stoked through tight margins, unfavorable rates, and seemingly slow movement in the market. Such an environment has everyone from seasoned industry professionals to fledgling mom-and-pop investors asking, “Will the real estate market ever recover?” For the determined investor, there is much to consider rounding out the corner of the year into 2025. Maintaining an awareness of the climate in the market as well as relying on actionable data-points could mean the difference between those who are successful and those who only break even, or worse, are forced out of the market altogether. The following is a summary of recent trends and developments throughout the real estate industry with the aim of highlighting and interpreting several key factors. With the proper framework, these datapoints can be leveraged to help investors better understand not only what has happened in the space, but what may be to come. A Matter of Interest / Is Anyone Interested? For investors, no discussion of the potential state of the industry into 2025 would be complete without an examination of interest rates. This necessitates a conversation about the Federal Open Market Committee and its decisions. The September decision by the Fed to slash rates by 50 basis points has big implications for the space. Those 50 basis points represent a change to a new target Fed Fund rate of 4.75-5%. This, and other decisions of a seemingly dovish tendency, may herald the ending of a “higher-for-longer” rate environment. Core inflationary numbers have seen a .2 descent in percentage points in 2024 (down to 2.6%) per one assessment by JPMorgan. This is largely expected to taper to a low of 2% flat by 2026. Such movements in the fed fund rate portend for investors the potential for a shift towards a lesser cost to borrow. Lowered borrowing costs would provide investors with a greater opportunity for capital from private and commercial lending sources. The S&P CoreLogic Case-Shiller Home Price Index shows home cost appreciation has increased consistently in the vast majority of US markets throughout 2024. This lowered cost to capital will enable investors seeking non-conventional funding to remain not only active, but competitive in the space with overall greater access to funding and success with private lenders. Activity in the Space / What’s Happening Here? Beyond interest rates, there are several other factors of which investors should take note when attempting to analyze the market. These factors take into account housing market activity and understanding where these figures have been can help determine where they might be going. Housing starts have increased steadily month over month throughout 2024. This means that, whatever the rate comparison year over year, housing inventory is being steadily addressed. There is still not quite enough inventory in the space to sate demand, or stimy competition between primary-buyers and investors, and so home price appreciations remain relatively high. Keeping track of housing starts, and specifically taking note of these figures by location or area market, can help investors predict when inventory will become available and can help to source deals, even getting properties under contract, ahead of the competition. If housing starts can represent anticipated inventory in the space, completed projects are a valuable trend for following new inventory as it becomes readily available. Data provided by the United States Census Bureau released in late October show that completion rates on newly developed residential properties have increased month over month since Q4 of 2023. This represents hundreds of thousands more housing projects seeing their way to completion than even before the onset of the 2020 pandemic. In spite of the high costs of acquisition, housing demand has not slackened. Total home sales are a metric that often directly correlates to, and is representative of, housing demand. One report from Redfin.com shows home sales have increased as recently as Q4 of 2024. The report also highlights that this increase in home sales was likely driven by two primary factors; the first of which are the recent rate cuts issued by the Fed discussed earlier in this article and the second being the expectation of further interest rate cuts as outlined in a plan by the Federal Reserve. The combination of these factors — housing-starts, completions, and home sales — speaks to a trend toward normalcy and health in the housing market. It is worth noting that while prices across the real estate industry could stabilize, it may be a step too far to expect that they should drop to any significant degree. That being said, even with such tight margins between home prices and the power of investment capital, market activity should continue at an even course. Finding the Right Answers Even with the real estate markets’ diverse history fraught with hard years and shifting economies, it is fair to say that this year, in 2024, the real estate market has truly been tested. It is imperative, perhaps now more than ever, that investors leverage the data at their disposal. The question of where the industry is ultimately headed persists. In answer to these challenges one thing remains consistent: real estate investing maintains its status as a lucrative and worthwhile endeavor for those with a keen mind for the market and wherewithal to see their vision through.

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The Future of Renting

Transforming Single-Family Rentals with Smart Technology by Sheri Young As the single-family rental (SFR) market adapts to new challenges, the role of smart technology is evolving from a “nice-to-have” to a crucial component of modern property management. As 2025 approaches, the question is not whether to adopt smart technology, but how best to leverage it to improve property management and the rental experience. Here is a look at three key areas where smart technology is shaping the future of the industry. Enhanced Asset Protection Keeping properties secure and well-maintained is a growing priority for property managers and investors, especially given the recent surge in trespassing and theft incidents in metropolitan areas like Atlanta, Chicago, and Dallas. This trend has highlighted the need for more sophisticated and flexible ways to monitor vacant properties between tenancies. Smart monitoring solutions safeguard these assets more effectively and respond to potential issues quickly. For example, Swidget’s vacant property monitoring kits utilize discreet high-definition video cameras and AI-powered human detection to provide real-time alerts when unexpected activity occurs in a vacant property. The cameras also capture live audio and video of the activity in the property that helps staff and law enforcement better prepare themselves to enter a potentially unsafe situation. When a property is leased, the solution can easily be removed and redeployed to another vacant property. This portability not only maximizes the usefulness of the equipment but also minimizes long-term costs since equipment can be moved as needed, instead of repurchasing it. This proactive approach to asset protection allows for greater safety in potentially dangerous situations, helps to prevent trespassing and property damage, and gives property managers valuable peace of mind, allowing them to focus on other operational priorities. Improved Tenant Experience Today’s tenants are not just looking for a place to live. They want a home that aligns with their lifestyle and expectations. A recent survey by Rent.com found that 82% of renters want at least one smart device in their home, with many willing to pay a premium for properties equipped with smart home technology. In response, many property managers are exploring ways to offer smart-ready homes that give tenants both convenience and control. While smart thermostats and door locks are already popular, Swidget’s modular smart products take tenant customization to a new level. Once smart-ready outlets and switches are installed, tenants can select and swap different smart sensors (from air quality sensors and night lights to USB chargers and motion sensors) according to their unique needs. By offering flexible smart technology, tenants are empowered to make a space their own while ensuring core functions like safety and energy efficiency. With connected outlets and switches, tenants can also monitor and manage their energy usage in real time and set schedules or automation to turn off devices when they are not needed. This not only enhances convenience but also makes it easier for tenants to lower their energy bills — a compelling feature for eco-conscious renters. By incorporating these features, greater tenant satisfaction and even longer lease terms are achievable as tenants feel more at home in a customized space. Reduced Operational Costs and Maintenance Operational efficiency is a priority for property managers, especially as expenses like emergency maintenance continue to rise. Smart technology plays a critical role in reducing operational costs through early issue detection and remote monitoring capabilities. By integrating devices that monitor temperature, humidity, air quality, and water leaks, proactive steps can be taken to prevent damage and avoid costly repairs. Consider, for example, the impact of a water leak sensor installed near appliances like dishwashers or washing machines. When these sensors detect a leak, they cause the electrical device to automatically shut off the power to the subject appliance, limiting water damage and preventing mold growth. Similarly, air quality sensors can be connected to ventilation systems to manage moisture and prevent issues such as mold and dust mites. These preventive measures reduce emergency maintenance calls and minimize tenant disruptions. Smart energy management solutions also offer substantial savings. Rising energy costs can significantly impact net operating income, and smart outlets and switches can mitigate this by enabling remote control of lighting and appliances, and through smart schedules and automations. Remote monitoring capabilities are particularly useful for large portfolios, where daily on-site inspections are not feasible. Over time, these cost savings accumulate, and the data gath­ered from sensors helps to optimize maintenance schedules and predict repairs before problems arise, ultimately improving the bottom line. Embracing the Future of Single-Family Rentals As more SFR operators recognize the benefits of smart technology, we are likely to see an acceleration in adoption rates. The demand for remote management solutions, in particular, is growing as property managers seek ways to streamline operations across multiple properties. Technology that allows managers to control, monitor, and troubleshoot remotely not only enhances efficiency but also allows for quick adaption in response to tenant needs or market trends. Looking ahead, integrated smart systems that communicate with each other will likely become more prevalent. Imagine a future where a property’s smart thermostat, lighting, security cameras, and water sensors are all managed from a single platform, providing comprehensive data that helps managers make informed decisions. These systems will likely incorporate AI to predict maintenance needs, analyze security risks, and automate responses based on occupancy patterns. Such advancements could redefine the SFR market, where seamless, intelligent property management is essential for staying competitive. The shift toward tech-driven management is here, and early adopters stand to gain a competitive edge in the evolving SFR landscape. Integrating smart technology can future-proof assets, providing a high-quality rental experience that resonates with today’s tech-savvy renters.

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On the Cutting Edge of Efficiency

Fordham Enterprises is Taking 3D Printing Technology Mainstream by Carole VanSickle Ellis When the COVID-19 pandemic hit in early 2020, Justin Fordham, founder and CEO of Fordham Enterprises, had to take a step back from his latest project of 20 three-unit residential homes, and reevaluate the situation. In New Jersey, where the project was located, most development contracts were pulled or frozen early in the pandemic, leaving investors and developers struggling to determine how they would complete projects or reenter the market. Fordham, however, did anything but flounder. He assessed the situation and ultimately decided cutting-edge technology and innovation would be the key to his market reentry. He founded Fordham Enterprises, a company that would take investors “from tech to title, helping to make homeownership a reality.” Fordham Enterprises describes itself as “a cutting-edge investment firm that combines 3D concrete printing technology and real estate development that is leading the way when it comes to bringing new methods of construction into the mainstream.” In addition to development and lending, the firm is the only private lender in the country dedicated solely to the 3DCP [3D concrete printing] industry. Fordham said, “Our commitment to innovation and social responsibility [3DCP residences are more affordable, faster to erect, and typically more energy efficient] fuels our relentless pursuit of creating sustainable communities.” Because 3DCP technology enables developers to “print” assets in layers, stopping only for the insertion of plumbing, electric, or other mechanical services, the timeframe for these projects is typically far more expedited than in traditional construction. “One of the problems we were having on the development side even before the pandemic was time,” Fordham said. He added, “The money was an issue as well because the cost of capital was already rising.” In early 2020, Fordham leveraged his time to research strategies for building and cutting margins without cutting the quality of the end product. He encountered all the “usual” solutions, but then, he encountered something even better: 3D printing. A developer himself, Fordham talked to the leading 3DCP manufacturers, lenders, and developers in this emerging space and developed partnerships with them. “They taught me about the process and how to implement it on a mainstream basis, and I, in turn, showed lenders how they can in most cases triple their ground-up funding by working with 3DCP developers,” Fordham said. Just four years later, Fordham Enterprises proudly states it is “the pioneering private lender dedicated to the 3DCP industry offering an unprecedented advantage with expedited ground-up funding for 3DCP projects.” Fordham noted, “Little did I know there were companies doing this type of development since the 1940s, but it is only just starting to be commercialized, disrupting the $10 trillion concrete industry in the process. Fordham Enterprises exists to help bring this technology and the affordable, high-quality housing it facilitates into today’s market.” A Long & Quiet History Concrete printing made a quiet debut nearly a century ago when inventor William Urschel used his “wall-building machine” to construct the first 3D concrete-printed building in history. That building, a basic structure composed of simple, concrete walls, was located behind a warehouse in Indiana. Since that time both concrete and 3D printing have come a long way; in 1998, high-strength concrete was used in the construction of high-rise buildings like Two Union Square in Seattle, and in 2006, “self-healing” concrete began to appear in construction. Self-healing concrete includes a “bacterial stimulant” that secretes limestone, enabling it to reseal cracks and minor damage. Today, 3DCP builds are weatherproof, fireproof, pest retardant and energy efficient. In 2020, the real estate space was ripe for the introduction of larger-scale developments and projects like Fordham’s due to housing scarcity and a national need for affordable residential options. “What we are really doing is pretty simple,” Fordham said. “We are utilizing A.I. and new machinery to help expedite the build process.” Fordham Enterprises is currently working not only on traditional single-family structures, but also larger buildings, including a four-story 3D-printed structure in New Jersey that will be the first of its kind when completed. “This building will have 21,000 square feet and 17 units,” Fordham said proudly. The mixed-use building is the largest 3DCP project in the country at this time and represents huge potential for expanding 3D printing opportunities in the multifamily, commercial, and industrial spaces. “U.S. inventory is behind by about 4 million homes,” Fordham said. “The only way we are going to make that up is if we transition how we build. We need to offload the work for humans and put the heavy work on machines so we can think better and work a little less.” He continued, “I love telling people to take a look at their six-to-eight-month process; I can do that same job in six to eight weeks.” 3DCP is largely impervious to weather conditions, making it ideal for areas with long rainy seasons. “We are able to tent the entire property and the machine itself, so rain and snow do not impede our development,” Fordham said. As 3DCP becomes more mainstream, Fordham said a misconception about the process has emerged around the idea that automating construction jobs will hurt employment in the industry. According to a 2019 study conducted by Oxford Economics, it is likely that systems like 3DCP and other manufacturing platforms could replace roughly twenty million jobs by 2030. However, according to the same study, automation and robotics also tend to increase demand for workers because these systems make more product available. In the case of 3DCP residential properties, that hypothesis holds true, Fordham said. He explained that historically, many people have expressed concerns about 3D printing putting developers and contractors out of business. In reality, he said, “It is actually the inverse. New technology coming to market opens up more jobs and opportunities because we can build more, build faster and build with better efficiency. We need to train more people, improve the relationship between lenders and developers, and educate investors to make the entire process easier.

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Women in SFR

On behalf of the National Rental Home Council’s Women in SFR group, we want to extend our Congratulations to you for being selected as a woman who exemplifies leadership, resilience, and inspiration in the single-family rental (SFR) industry. This recognition is a testament to your hard work, dedication, and the positive example you set for other women in the industry. We are happy to celebrate this moment with you and thrilled to feature these amazing women in the December issue of REI INK magazine. The National Rental Home Council’s Women in SFR group is dedicated to supporting women in the single-family rental home industry by creating opportunities for networking, mentorship, knowledge-sharing and allyship, and helping to foster a more diverse and inclusive place for women. LinkedIn Group — WMN in SFR // Contact Yovonne Kenny, Preferred Floor & Tile  Executive Vice President email: Yovonne.Kenny@preferredfloorandtile.com or call (980) 721-2130

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