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- Mom-and-pop landlords aren't big fans of institutional homebuyers
Mom-and-pop landlords aren't big fans of institutional homebuyers
Only 14.9% of real estate investors have a favorable view of institutional landlords, according to the Flock Homes-ResiClub Real Estate Investor Survey.
Today’s newsletter is brought to you by ResiDay!
On Friday, November 8th, in New York City, ResiClub will host ResiDay, bringing together the brightest minds in the housing market. This will be our first-ever one-day conference.
There will be hundreds of influential housing investors, developers, lenders, and brokers who are shaping the future of residential real estate, homebuilding, mortgage lending, and build-to-rent at ResiDay. Several prominent business and real estate journalists will also be there.
The ResiClub team will lead a day of insightful discussions on market trends and strategies impacting the future of the U.S. housing landscape. Expect top-tier speakers, ample networking opportunities, and hours of engaging discussions on the future of the U.S. housing market.
On a national level, institutional home buyers, firms owning at least 1,000 homes, aren’t massive players yet—they only own around 1% of the U.S. single-family stock, according to Parcl Labs. When it comes to investor ownership, small players with 2 to 9 homes in their total portfolios are still the biggest players in the national housing market.
That said, in a handful of regional pockets, institutional homebuyers have a greater presence. In fact, just six markets (Atlanta, Charlotte, Dallas, Houston, Phoenix, and Tampa) are home to 36.8% of all the nation’s institutionally owned single-family homes.
How do mid-sized and mom-and-pop landlords feel about these institutional landlords?
To find out, ResiClub teamed up with Flock Homes to poll 284 real estate investors—85% of those surveyed own between 2 and 20 investment/rental properties. Tomorrow, ResiClub readers will receive the full results from the Flock Homes-ResiClub Real Estate Investor Survey.
Among the real estate investors who own investment/rental properties polled in the Flock Homes-ResiClub Real Estate Investor Survey conducted this month, 54.4% told us that they have a “somewhat unfavorable” (30.9%) or “very unfavorable” (23.5%) view of institutional landlords.
Only 14.9% of real estate investors have a “somewhat favorable” (12.4%) or “very favorable” (2.5%) view of institutional landlords.
This means institutional landlords have a net favorable rating of -39 among small and midsized landlords.
Here’s where things get interesting…
While real estate investors aren’t fans of institutional landlords, they’re far more split as to whether stricter regulations for the big dogs would actually benefit smaller landlords.
Among real estate investors we surveyed, 54.2% say stricter regulations targeting corporate landlords would be “somewhat positive” (46.3%) or “very positive” (7.9%) for mom-and-pop landlords.
On the flip side, 45.8% of real estate investors say stricter regulations targeting corporate landlords would be “somewhat negative” (32.1%) or “very negative” (13.8%) for mom-and-pop landlords.
According to Parcl Labs, institutional operators (those owning at least 1,000 single-family homes) have the highest percentage of ownership in these five markets:
Atlanta (4.33%)
Jacksonville (3.77%)
Charlotte (3.23%)
Memphis (3.11%)
Tampa (2.85%)
Within markets that percentage also varies a great deal. As ResiClub has previously reported, when institutions push into a market, they often concentrate in the same neighborhoods.
Click here to view an interactive of the map below
Last month, the Federal Housing Finance Agency (FHFA) published data on outstanding U.S. mortgages in Q2 2024.
—> 25.4% of U.S. mortgage borrowers have a rate ABOVE 5.00%
—> 74.6% of U.S. mortgage borrowers have a rate BELOW 5.00%
The higher rate share is gradually increasing, as new buyers take on rates above 6.0% + borrowers slowly pay down.
6.85% —> The average 30-year fixed mortgage rate today, as tracked by Mortgage News Daily
263 bps —> The “spread” today between the 30-year fixed mortgage rate and the 10-year Treasury yield
7.97% —> The average 30-year fixed mortgage rate on the same day last year (October 22, 2023)