New single-family rental homes are on the rise in Denver

Denver is one of the top 11 metros adding the most new single-family homes for rent, data show.

Why it matters: Built-to-rent housing can provide the opportunity to move into a brand-new, single-family home without a huge down payment or long-term commitment, Axios' Felix Salmon reports.

• The Denver metro is short almost 70,000 homes for sale or rent, one of the widest housing gaps in the country, a new Zillow analysis shows.

What's happening: Those houses have found a growing niche among would-be buyers who can't afford — or find — a single-family home, and those opting not to buy for lifestyle reasons, Doug Ressler of real estate research firm Yardi Matrix tells Axios.

Driving the news: The metro's built-to-rent supply almost doubled in the last five years, surging by 91%, per a recent report from listing service RentCafe.

• The trend is expected to persist. Denver made the top 15 for the number of such homes currently under construction, per the data.

By the numbers: Across the Denver metro, 888 single-family rentals were added between 2017 and 2022, bringing the total supply to 1,869 — the 11th-largest in the country, according to RentCafe.

• Plus, 920 built-to-rent units are currently under construction and expected to be completed in 2023.

Zoom in: "Especially in lifestyle markets," like Denver, "people want a maintenance-free type of living, because they may want to go get on their trail bike, they want to do other things," says Ressler, manager of business intelligence at Yardi Matrix, which provides data for RentCafe.

• "The Denver area is prime" for these kinds of houses, he says.

What they're saying: "Built-to-rent housing is quickly emerging as an essential, and highly desirable, sector of America's housing market," says David Howard, CEO of the National Rental Home Council.

Be smart: Single-family rentals are nothing new. Like multi-family housing, the market has developed over many decades, according to commercial real estate company CBRE.

The bottom line: Building more single-family rentals isn't going to solve the housing crisis, but it could help ease the supply crunch.

In Denver, there are 632 built-to-rent units planned or under construction per million inhabitants, according to the National Rental Home Council.

State of play: These houses aren't available everywhere. In 10 states, there is no single-family, built-to-rent construction ongoing or even planned, the group found.

• Arizona leads with 2,011 units planned or under construction per million inhabitants.
• Nationwide, the average is 345.

By the numbers: Across the Denver metro, 888 single-family rentals were added between 2017 and 2022, bringing the total supply to 1,869 — the 11th-largest in the country, according to RentCafe.

• Plus, 920 built-to-rent units are currently under construction and expected to be completed in 2023.

The big picture: National construction of new build-to-rent homes hit a record high last year, with more than 14,500 houses completed and three times as many under construction, per RentCafe.