Are The Days Of The Accidental Landlord Over?
Channel: Noel Christopher
Date: 28/04/2021

I had an interesting exchange with Michael Cook a week ago around the institutionalization of the single family rental asset class and what that means for the small landlord.

Small landlords dominate the small. Close to 90% of SFR homes are owned by small landlords. Since 2012 with institutional investors entering the space the talk of institutionalization has been a common subject.

It has happened in every other asset class. Look at #Multifamily in the '90s. What was once dominated by small investors is now upwards of 50% institutional.

Sometimes it takes a convergence of events to push things over the edge. I think it is happening now.

1. Unprecedented demand for homes, both rental and owner-occupied.
2. Record low inventory, due to several factors.
3. Government intervention in the form of forbearance, moratoriums, extended unemployment, stimulus, low rates, etc. At the same time leaving mom and pop landlords hung out to dry.
4. Rental regulations across the country.
5. Unlimited cheap capital for institutional investors.

What does all this mean? I believe it is the beginning of the end for the small landlord. They can't compete with the money that is flowing into the SFR space.

Tell me what you think.


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