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Large‐Scale Buy‐to‐Rent Investors in the Single‐Family Housing Market: The Emergence of a New Asset Class

Author

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  • James Mills
  • Raven Molloy
  • Rebecca Zarutskie

Abstract

In 2012, several large firms began purchasing single‐family homes, creating large portfolios of rental property, and securitizing these investments in capital markets. We present the first systematic evidence on this new investor activity in order to shed light on the factors that have supported its emergence. Three key factors were the ample supply of property for sale, tight mortgage financing and a decrease in acquisition and managerial costs brought about by technological advances. In addition, we show that buy‐to‐rent investors appear to have supported house prices in the neighborhoods where they concentrated.

Suggested Citation

  • James Mills & Raven Molloy & Rebecca Zarutskie, 2019. "Large‐Scale Buy‐to‐Rent Investors in the Single‐Family Housing Market: The Emergence of a New Asset Class," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 47(2), pages 399-430, June.
    • Handle: RePEc:bla:reesec:v:47:y:2019:i:2:p:399-430
    DOI: 10.1111/1540-6229.12189
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    1. repec:osf:osfxxx:afzdx_v1 is not listed on IDEAS
    2. Mayock, Tom & Vosters, Kelly, 2026. "Educational achievement gains afforded by moving to single-family rentals," Journal of Housing Economics, Elsevier, vol. 71(C).
    3. Stephanie Kestelman & Rebecca Diamond & John Eric Humphries & Kate Pennington & Winnie van Dijk & John Voorheis, 2026. "Toward a Methodology for Measuring Rental Property Ownership in the United States," NBER Chapters, in: Measurement of Housing and the Housing Sector, National Bureau of Economic Research, Inc.
    4. Jung Sakong, 2021. "Effect of Ownership Composition on Property Prices and Rents: Evidence from Chinese Investment Boom in US Housing Markets," Working Paper Series WP-2021-12, Federal Reserve Bank of Chicago.
    5. Ken Chilton & Robert Mark Silverman & Rabia Chaudhry & Chihaungji Wang, 2018. "The Impact of Single-Family Rental REITs on Regional Housing Markets: A Case Study of Nashville, TN," Societies, MDPI, vol. 8(4), pages 1-11, September.
    6. Gallin, Joshua & Verbrugge, Randal J., 2019. "A theory of sticky rents: Search and bargaining with incomplete information," Journal of Economic Theory, Elsevier, vol. 183(C), pages 478-519.
    7. Walter D’Lima & Paul Schultz, 2022. "Buy-to-Rent Investors and the Market for Single Family Homes," The Journal of Real Estate Finance and Economics, Springer, vol. 64(1), pages 116-152, January.
    8. Bilgi Yilmaz, 2025. "Optimal Portfolios for Large Investors in Housing Markets Under Stress Scenarios: A Worst-Case Approach," Computational Economics, Springer;Society for Computational Economics, vol. 65(5), pages 2853-2871, May.
    9. Molloy, Raven & Nathanson, Charles G. & Paciorek, Andrew, 2022. "Housing supply and affordability: Evidence from rents, housing consumption and household location," Journal of Urban Economics, Elsevier, vol. 129(C).
    10. Jessica Rutherford & Ronald Rutherford & Abdullah Yavas & Lei Wedge & Marcus T. Allen, 2025. "Micro Evidence Relating to House Rents, Prices and Investor Size from a Matched Dataset," The Journal of Real Estate Finance and Economics, Springer, vol. 70(1), pages 38-64, January.
    11. Brett Christophers, 2022. "Mind the rent gap: Blackstone, housing investment and the reordering of urban rent surfaces," Urban Studies, Urban Studies Journal Limited, vol. 59(4), pages 698-716, March.
    12. Darren K. Hayunga & Henry J. Munneke, 2026. "Volume Traders of Non-Homogenous Assets," The Journal of Real Estate Finance and Economics, Springer, vol. 73(1), pages 40-73, July.
    13. Muñoz, Manuel A., 2020. "Macroprudential policy and the role of institutional investors in housing markets," Working Paper Series 2454, European Central Bank.
    14. Ihlanfeldt, Keith & Yang, Cynthia Fan, 2021. "Not in my neighborhood: the effects of single-family rentals on home values," Journal of Housing Economics, Elsevier, vol. 54(C).
    15. Erlend Eide Bø, 2026. "Buy to Let: The Role of Rental Investors in Housing Booms," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 67(2), pages 657-696, May.
    16. Panagiotis Petris & George Dotsis & Panayotis Alexakis, 2025. "Do Mortgage Buy‐To‐Let Investors Pay More or Less for Properties? Empirical Evidence From the UK Residential Market," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 30(4), pages 4182-4196, October.
    17. Ihlanfeldt, Keith & Yang, Cynthia Fan, 2021. "Single-family rentals and neighborhood racial integration✰," Journal of Housing Economics, Elsevier, vol. 53(C).
    18. Jurre Thiel & Henrik Zaunbrecher, 2023. "Mortgage Debt Limits and Buy-to-Let Investors: A Structural Model of Housing with an Endogenous Rental Sector," CPB Discussion Paper 449, CPB Netherlands Bureau for Economic Policy Analysis.
    19. Gareth Fearn, 2025. "Housing the historical bloc: Civil society contestation of authoritarian neoliberalism in England," Urban Studies, Urban Studies Journal Limited, vol. 62(15), pages 2956-2975, November.
    20. Marcus T. Allen & Jessica Rutherford & Ronald Rutherford & Abdullah Yavas, 2018. "Impact of Investors in Distressed Housing Markets," The Journal of Real Estate Finance and Economics, Springer, vol. 56(4), pages 622-652, May.
    21. Oosthuizen, Dick, 2026. "Institutional housing investors and the Great Recession," European Economic Review, Elsevier, vol. 182(C).
    22. Stephen B. Billings & Adam Soliman, 2023. "The erosion of homeownership and minority wealth," CEP Discussion Papers dp1967, Centre for Economic Performance, LSE.
    23. Stephen B. Billings & Adam Soliman, 2025. "The social spillovers of homeownership: evidence from institutional investors," CEP Discussion Papers dp2123, Centre for Economic Performance, LSE.
    24. Dirma, Mantas & Karmelavičius, Jaunius, 2025. "Micro-assessment of macroprudential borrower-based measures," Journal of Banking & Finance, Elsevier, vol. 176(C).
    25. Bandoni, Emil & De Nora, Giorgia & Giuzio, Margherita & Ryan, Ellen & Storz, Manuela, 2025. "Institutional investors and house prices," Working Paper Series 3026, European Central Bank.

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