With REO properties becoming increasingly scarce (although still very present), many expected the surge of Single Family Rental investments to decrease as well. However, many SFR investors – especially institutional investors – are still buying up properties, and not just bank-owned properties, either. Diana Olick interviews Doug Brien (CEO of Starwood Waypoint) in this article who discusses budding partnerships between home builders and institutional investors, wherein the builder gives the investor a discount on new homes and the investor reciprocates with something that’s been somewhat lacking in the new construction arena: demand.
As Brien mentions, new homes are only 5% of Starwood’s overall portfolio, so the numbers aren’t astronomical at this point. However, symbiotic relationships like this could be a boon for one part of a sluggish housing market (i.e. builder activity0 in addition to providing rental options for former homeowners who still desire to live in a single family residence.