The number of single-family homes built-for-rent in the US increased over the course of 2018, as construction starts of this type of housing totaled 43,000 homes, compared to 37,000 for 2017. There were 10,000 single-family built-for-rent starts for 4Q 2018.
According to data from the Census Bureau’s Quarterly Starts and Completions by Purpose and Design and NAHB analysis, the market share of single-family homes built-for-rent, as measured on a one-year moving average, stood at 4.9% of single-family starts as of 4Q 2018.
Given the small size of the market segment, the quarter-to-quarter movements are not typically statistically significant. The current market share remains higher than the recent historical average of 2.7% (1992-2012) but is down from the 5.8% reading registered at the start of 2013. This class of single-family construction excludes homes that are sold to another party for rental purposes. It only includes homes built and held for rental purposes.
US Built-for-Rent Multi-Family Construction: 4Q 2018
An elevated rental share of multifamily construction is holding typical apartment size below levels seen during the pre-Great Recession period. As multifamily developers in the US build more for-sale housing units in the years ahead, the average size of multifamily homes is likely to rise.
The market share of rental multifamily construction starts ticked down to 94% during 4Q 2018. In contrast, the historical low share of 47% was set during the third quarter of 2005, during the condo building boom. The average share of 80% was registered during the 1980-2002 period. There were only 24,000 multifamily condo units that started construction over the last year, just slightly higher compared to 2017 (20,000).