It’s been an interesting few weeks in real estate. Mortgage rates are hitting record lows, housing prices are hitting record highs and shopping malls are becoming Amazon fulfillment centers — all in the midst of a pandemic. As government stimulus expires I anticipate we will see the full extent of what effect this crisis is having on consumers, but I believe SFR will continue to be THE bright stop of the real estate world for the foreseeable future. Some key trends that have stuck out over the past few weeks:
Below you can see that while new listings are up slightly, rental listings are not recovering from pre-COVID levels with a this is a 20% decline in YoY. This drives cumulative year-to-date listings supply down to -12%YoY as of July 18th. As a result, leasing velocity stays 1.5x higher than the last year. Signs of increased sellers caution in Florida with Tampa and Miami post correspondingly 14% and 3% fewer new listings than the last year. It is a decline from the previous week, which is meaningful, given that the US market improved from -1% YoY to 5% YoY. We feel SFR is uniquely positioned to be a resilient, bright spot compared to its real estate asset class peers for the rest of the year, and we have already seen a meaningful increase in out-of-state applicants for our homes as individuals leave dense urban areas and city living for more space. With resident retention levels rising across our portfolio and other single-family rental assets, there is an increasingly evident and significant shortage of affordable high-quality rental assets in the marketplace.
