**Title: Build-To-Rent Homes: A Comprehensive Guide for Renters and Investors**
**Introduction**
In the past two decades, the percentage of renters in the United States has risen significantly, largely due to the increasing costs of homeownership. In response to this trend, a new real estate market option has emerged: build-to-rent homes. These homes, often entire complexes, are built specifically for long-term renters. Whether you’re looking to invest in these properties or considering renting one as your primary residence, this guide will provide valuable insights.
**What Are Build-To-Rent Homes?**
**Build-To-Rent, BFR, and B2R Defined**
“Build-to-rent (B2R)” and “build-for-rent (BFR)” are interchangeable terms referring to detached units built specifically for long-term rental. These properties are typically maintained by large companies, but individual investors can also participate in this market.
**Types of Build-To-Rent Homes**
Build-to-rent houses can resemble traditional suburban family homes with front porches and backyards. They can also include various building plans, such as:
– **Horizontal Apartments:** Tight clusters of professionally managed, freestanding, single-family residences.
– **Duplexes:** Two living units attached to each other.
– **Row Homes:** Homes built side by side, sharing a common wall.
– **Small Lot Homes:** Individual homes built close together, often on lots as small as 600 square feet.
**Market Share of Build-To-Rent Properties**
As of 2023, build-to-rent properties made up an estimated 7.9% of single-family properties, with over 75,000 new units beginning construction in 2023a 9% increase from 2022.
**Should You Rent a Build-To-Rent Property?**
Renting a home can feel less monumental than buying one, but it’s still crucial to weigh the pros and cons.
**Pros of Living in a Build-To-Rent Property**
– **Freedom from Maintenance:** Enjoy the comforts of homeownership without the stress of repairs and maintenance.
– **Creature Comforts:** Many build-to-rent homes come with luxury features like swimming pools and communal amenities.
– **Community:** Build-to-rent communities are often more tight-knit and neighborly than apartment complexes.
**Cons of Living in a Build-To-Rent Property**
– **Higher Costs:** Rental prices for build-to-rent properties are typically higher than apartments.
– **Lack of Ownership:** Unlike buying a house, rental payments do not contribute to owning a valuable asset.
– **Smaller Size:** Build-to-rent properties are often smaller than other homes.
– **Lack of Personalization:** These homes often lack the individuality of homes built for sale.
– **Limited Remodeling Freedom:** Major alterations are usually not allowed.
**Should You Build a Home to Rent Out?**
The current real estate market boom has made purchasing rental homes challenging for many investors. Building a build-to-rent property can be an attractive option, but it comes with its own set of pros and cons.
**Pros of Building Rental Properties**
– **Less Tenant Turnover:** Long-term renters reduce the stress of frequently searching for new tenants.
– **Early Market Entry:** Building a property can help you enter the real estate market without competitive struggles.
– **Location Flexibility:** Easier to build in up-and-coming real estate markets.
**Cons of Building Rental Properties**
– **Increased Competition:** Large-scale operations have economies of scale that work against private individuals.
– **Potentially Lower ROI:** Buying distressed properties can offer better returns on investment.
**Investing in Build-To-Rent Without Building**
One alternative is investing in residential real estate investment trusts (REITs). These trusts specialize in acquiring or developing rental properties. Investing in REITs allows you to benefit from the success of build-to-rent properties without the hassle of building one yourself.
**Conclusion**
Build-to-rent is a growing trend for good reasons. For those not ready for homeownership or struggling to save, these homes offer comfort and community. For investors, they provide a way to enter a competitive market. However, it’s essential to weigh all potential downsides. Conventional homeownership and apartment rentals still hold many advantages.
If you’ve decided that buying a home is the right move for you, start your mortgage application with O1ne Mortgage Inc. Visit [O1ne Mortgage Inc.](https://o1nemortgage.com) or call us at 888-372-8820 to speak with a mortgage expert, request a quote, or apply for a loan.
**Keywords:** build-to-rent homes, B2R, BFR, rental properties, real estate investment, residential REITs, O1ne Mortgage Inc., mortgage application, long-term rental, real estate market.
