Jul 10, 2023 - Real Estate

Built-to-rent housing is surging in North Carolina

Single family built-to-rent units planned or under construction, per million residents
Data: National Rental Home Council, U.S. Census Bureau; Chart: Thomas Oide/Axios

The brutal housing market is driving more and more Americans to opt out of buying.

  • That's especially apparent in North Carolina, where more built-to-rent homes are popping up than double the national average.

Why it matters: Built-to-rent housing offers a new, single-family home with property management perks, and without the need for a down payment or long-term commitment, Axios' Felix Salmon reports.

Driving the news: More than 1,000 built-to-rent homes are planned or under construction per million North Carolina residents, per the National Rental Home Council.

  • Nationwide, the average is 345.

What's happening: These houses are in growing demand 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: National construction of new built-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.

Zoom in: Built-to-rent neighborhoods have sprouted across North Raleigh and the suburbs in recent years, as the Triangle's rapid population growth makes it attractive to investors.

  • In just the past month, two large national builders with multiple communities in the Triangle each submitted plans to build hundreds of built-to-rent homes in north Raleigh and Wake Forest, the Triangle Business Journal reported.

Between the lines: The surge comes as a shortage in new construction has placed a strain on the Triangle's housing market, driving up prices and rents.

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

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

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