The number of renters of single-family homes in the U.S. is on the rise, up from 14 million in 2020 to 14.2 million in 2023, according to Minnesota-based data provider IPUMS.
High home prices, fluctuating mortgage rates and limited availability of for-sale homes have contributed to this home rental boom, as homeownership is out of reach for many who would like to live in a single-family home. In this environment, single-family rentals have “become the new starter home,” according to a report by Point2 Homes, a division of Yardi.
Over the same period of time, the number of new single-family build-to-rent units has skyrocketed — up from 7,676 new deliveries in 2020 to 27,495 in 2023 — as developers aim to meet this demand. Another 45,400 single-family rentals are under construction, and 2024’s deliveries are set to surpass last year’s, according to Point2.
In a survey of 1,509 respondents — 1,020 who already rented a home and just under 500 more from potential renters — Point2 found that the top three reasons renters choose homes over apartments are more privacy, more space and having a yard or garden. Rent was the most influential factor on which homes renters chose, followed by house size, pet policy and the condition of the home.
More than 59% of current renters said they were satisfied with their home, while 27.4% are neutral. However, over half of respondents — 51% — still say that they plan to buy a house in the near future. Only 18.9% say they foresee renting homes long-term.
While renting means residents can’t modify homes to their liking the way an owner can, more than 41% of respondents said they weren’t bothered by this restriction. In fact, 4% preferred it, choosing instead to personalize their spaces with their own items.
When asked what they could change if they could, 20.9% expressed a desire for an upgraded kitchen. Additional storage space and improved energy efficiency were other popular preferences.
Unconventional features that could convince renters to switch homes were a sundeck, a workshop or craft room, or an area to garden. When asked which amenities might justify an increase in rent, the majority — 45.1% — cited utilities included in rent, followed by a swimming pool and upgraded kitchen appliances.
Pets take top priority
Almost 69% of the survey’s respondents had pets, according to Point2. More than 13% said their pet was their main reason for renting a home over renting an apartment — a larger share than the 11.3% of house renters looking to accommodate a growing family.
For more than 23% of home renters, whether or not a property allows pets is a crucial deciding factor in whether or not they rent a home there. Close to 6% say that pet friendliness would justify an increase in rent.
House renters in Generation Z also showed a particular preference for sustainability. Over 44% say that sustainability is an important deciding factor in their home choice, and an additional 7.3% say it is extremely important.
“By zeroing in on what matters most to single-family renters — like pet-friendly policies, privacy, space and sustainability — property managers and developers can tap into fresh opportunities and reshape the rental landscape,” the report said.
