The United States Federal Trade Commission (FTC) has turned its attention to single-family rental housing, signalling intentions to investigate owners of and investors in portfolios with more than 1,000 properties. As a first step, the FTC is seeking public comments before it embarks on the statutory procedures to compel identified entities to provide information about their holdings and operations.
“This proposed study would shed much-needed light on the mega-investors that have amassed huge portfolios of single-family rental units and potentially contributed to the housing challenges that Americans face,” says Lina Khan, chair of the FTC. “It’s vital to understand the role played by large institutional investors.”
It’s estimated that the large rental portfolios targeted for the study collectively own about 446,000 single-family homes throughout the U.S.. The FTC cites concerns from “local, state and federal policymakers” about how so-called mega-investors are influencing pricing and homebuyer competition in local housing markets. If the study is approved to proceed, information collected from the designated entities will be compiled in a publicly available comprehensive list matching properties to their owners.
“Although this information is already publicly available at the state and county level, its disaggregated nature and indirect ownership structures involving opaquely named shell companies complicates the ability to fully assess the scale and scope of mega SFR (single-family rental) investors’ property holdings. Numerous researchers and other policy stakeholders have called for greater transparency to better understand where, and to what extent, these SFR investors operate,” the FTC states.
Meanwhile, the data and analytics provider, CoreLogic, reported “rent growth is decelerating” across the major U.S. markets it monitors coming out of the third quarter of 2024. The firm’s most recently released stats peg the average year-over-year rent increase at 1.7 per cent for its total single-family rental index, covering 100 nearly metropolitan areas, as of October. That’s the lowest rate of rent growth since June 2020.
Trends are varied in the 20 largest markets. As of Q3 2024, year-over-year rent trajectory ranges from a 6 per cent increase in Detroit to a 3 per cent decrease in Austin, Texas. However, CoreLogic analysts also underscore the longer-term patterns that have pushed up single-family rents in Austin by 22 per cent since February 2020.
“Markets that have had tepid rent increases over the past two years led rent increases for the nation. Markets in the South and West, many of which had red-hot rent growth since 2022, brought down average rent growth,” says Molly Boesel, senior principal economist with CoreLogic.
Among the 20 markets, San Diego registers the highest median rent for single-family rental at USD $4,039 (CAD $5,775). Philadelphia is the most affordable, with a median rent of USD $1,649 (CAD $2,358).