Why Are Build-to-Rent Homes Growing More in Demand?

January 13, 2023

The build-to-rent model has become increasingly popular in the U.S., with numerous renters and investors finding it to be an attractive option. Its ability to provide a combination of affordability, variety, and high demand is a major draw for both smaller companies and major public companies.

As opposed to being a homeowner, more people are opting to rent single-family homes instead. This trend is becoming increasingly popular, with developers building and leasing these homes to tenants. 

This new approach to real estate investment offers many advantages, such as building a portfolio of rental properties without the hassle of dealing with tenants.

Let's look at why the demand for build-to-rent homes is growing.

What is a Build-to-Rent Home?

A build-to-rent home is a single-family residence that is built and rented out to tenants instead of being sold to a homeowner. It is an investment strategy that allows investors to purchase, develop, and rent out homes, creating a stable income stream.

The development of build-to-rent homes allows investors to diversify their portfolios and increase their returns. This is because the rental income generated from these properties is typically higher than traditional real estate investments. 

Why is Demand for it Growing?

Demand for build-to-rent homes is growing due to a variety of factors. Here are a few.

1) Financing Availability

Investing in real estate in the U.S. is fast becoming a popular choice, especially for smaller developers and real estate investors. The demand for single-family homes for rent is on the rise, and as a result, more rental communities are being built to meet this need. 

The availability of loans for build-to-rent housing makes it possible for smaller investors to get financing and build these communities.

Financing that is reasonably priced, combined with an increased need for housing that is suitable for multiple generations, could lead to very profitable returns when investing in single-family homes that are constructed for the purpose of renting out.

2) Potential Exit Strategies

Selling a piece of real estate gives the owner more options and potentially more money. Instead of only being able to sell to another investor, the owner can consider selling to a company that could be interested in the property for a different purpose, like a retail store, restaurant, or another type of business. 

This gives the owner more control over the sale, and also opens up the possibility of selling for a higher price.

When the time comes to sell, residential property investors who have purchased single-family build-to-rent homes have a variety of options for exiting their investment.

3) Demographic Appeal

The appeal of property ownership is strong for millennials and Gen-Z due to its potential to provide stability and appreciation in value over time. 

Low-interest rates and a wide range of financing options make it easier for these generations to purchase property, and they are increasingly doing so to build wealth and establish a sense of ownership. 


Build-to-Rent homes are becoming increasingly popular due to the convenience, affordability, and flexibility they offer. They provide a great alternative for those who are not ready to commit to buying a home but still want the stability and security of having their own property. 

If you want to secure your future with a good investment, Next Generation Land Company has you covered. We will help you manage Florida property investments to make the most out of your money and living situation. Get in touch with us to get started.