The Commercial Real Estate Alpha Site

By Jay Parsons via LinkedIn w/ WSJ. <— Click here for more strong research from Jay.

“Accidental landlords” are getting a lot of press of late, and it’s a good reminder of something most Americans still don’t understand:

It’s not institutional investors gobbling up homes off the MLS and helping keep prices high.

It’s would-be individual sellers choosing to hold onto homes as rentals.

Right now, it’s a bad market to sell if you don’t have to. If you need to move, but you have the cash and the debt-to-income ratios to buy another house, it might make sense to hold onto your old home as an investment. Those “accidental landlords” are likely far less concerned about yield on cost or operating margins (as sidelined larger investors would be) and more concerned with long-term value appreciation.

Remember: Individuals and families with 1-5 homes dominate the single-family rental market, with around 90% market share. New data reported by ResiClub last week from BatchData shows institutional investors control … wait for it … a whopping 1.6% of the market.

In no other industry is there so many people convinced that those with 1.6% market share control the market.

#housing #sfr #rents