CEOs of the largest companies renting out single-family homes say they plan to raise rents up to 5.7 percent this year, as they switch their focus from buying more properties to optimizing revenue from the thousands of properties they already own. According to Bloomberg, they want to take advantage of an increased demand for rental homes.
“In the 2015 rental season, we’re really seeing the ability to move rents,” says David Singelyn, chief executive officer of American Homes 4 Rent at a recent conference in Miami Beach. The company is one the nation’s largest publicly traded, single-family landlords. It has about 35,000 homes in its inventory.
Large-scale investors – those who purchase at least 10 properties a year – have spent about $68 million snatching up 528,000 single-family rental homes since 2011, according to a report last month by Haendel St. Juste, a Morgan Stanley analyst. Now the CEOs of Silver Bay, Starwood Waypoint, American Residential Properties and Blackstone Group all say they plan to start raising rents this year.
“We are focusing aggressively on rent bumps,” Stephen Schmitz, American Residential Properties CEO, said during a panel discussion. “There’s a supply imbalance in some markets. The same thing that keeps occupancy high also drives rents.”
Schmitz says he plans to bump up rental rates by 4 percent on renewals and up to 5.7 percent for new tenants.
Source: “U.S. Single-Family Landlords Are Raising Rents, CEOs Say,” Bloomberg (April 21, 2015)
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