Ask any homebuilder developer what they think are the 2 biggest risk factors affecting future housing projects and many will include a shortage of land and lumber. Wait, lumber (like, wood)?!? Yes, lumber. Current prices are more than 4 TIMES what they were a year ago at about $1,500 per 1000 feet versus $330 last May. Take a look at live futures prices HERE.
Read MoreAccording to United Van Lines, move out requests from San Francisco and New York to any destination were up 23% and 45%, respectively, versus the same period in 2019. And in San Francisco specifically, Apartment List reported that the share of users interested in moving to a secondary city increased by 9% compared to pre-pandemic levels. Statistics like that sent real estate professionals scrambling to figure out where those people were headed and cities such as Austin, Dallas Fort-Worth, Denver, Nashville, and Raleigh found themselves among the top destinations.
Read MoreAnyone who has been paying attention to the commercial real estate investment world recently has likely taken notice of the tremendous popularity of the built-for-rent (BFR) sector. As an early investor in the space, we receive many calls and messages from individuals who are trying to better understand what’s going on...
The past 6 months alone has seen a dizzying sequence of announcements from major home builders, investment managers, and publicly traded companies announcing ambitious plans to invest heavily into the single-family rental (SFR) industry.
Read MoreWall Street's wager on high earning suburban renters is in full view as major industry players are choosing to double down on their SFR investments despite the pandemic. One publicly traded REIT, American Homes 4 Rent (AMH), recently announced that a $225 million deal that it made with J.P. Morgan Asset Management in February to build rental houses was increasing to $650 million! How did this happen while nearly every major real estate company in the country had a moratorium on new deals?
Read MoreIf you are anything like us, you are probably confined to your home seeing constant headlines about COVID-19 and its effects on literally everything. Unemployment is rapidly rising. The stock market is volatile. Travel has stalled. Nobody knows when this is going to end. Maybe this summer, maybe next year.
As real estate investors, that means that we have to explore scenarios to see how our favorite real estate sector - single-family rentals (SFR) - will fare in this market environment. There’s a lot of factors at play, so by no means is this an article on what to do or what will likely happen. The purpose of this piece is mainly to touch upon what a SFR is and how the asset class might perform during a prolonged recessionary environment.
To start, let’s talk about what a SFR is.
Read MoreThe opinions expressed within the contents of this website are those of its authors and Steel City Management LLC (“SCM”). Steel City Management is not a registered broker, dealer, or registered investment advisor. The investment offerings on this site are available only to “Accredited Investors” as defined by the IRS. These opinions should not be interpreted as a recommendation or statement of fact. All investors should make their own determination of whether or not to make any investment, based on their own independent evaluation and analysis. The information on the website should not be interpreted as financial advice. Past performance is not a guarantee of future results. All investments offered by SCM involve risk and may result in loss. Investors are advised to consult with their tax, legal and financial advisors before making any investment decisions. SCM does not give investment advice nor recommendations regarding any investment decisions.
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