Single family built-for-rent subdivision investments
Single family residential built-for-rent subdivision investments are an asset class some investors looking to invest in the rental market may want to consider. These types of properties are becoming increasingly popular, especially among high-net-worth individuals.
There are a few reasons why these types of investments may make sense for some investors. This type of investment may provide more exit flexibility than other types of multifamily properties. For example, you can choose to sell off individual units or the entire subdivision. Additionally, they tend to be less operationally complex than other types of rentals since the single-family layout and experience tend to attract a higher quality of tenant.
If you’re interested in learning more about single family built-for-rent subdivision investments, be sure to continue reading below. We’ll go into more detail about the characteristics of these investments and where some investors may find value.
It is important to consider both risks and potential benefits of any investment opportunity. There are risks inherent in all real estate investments, including but not limited to risks related to macroeconomic factors, environmental factors, political factors, and construction risks that may interfere with the ability of an investment manager to execute the business plan. It is important to discuss each potential investment with your legal, tax, and investment professionals to determine whether the level of risk in each investment is appropriate in your specific situation.
How economic conditions may play into investment decisions about rental property
The current state of the economy, while volatile, may present an opportunity to build rental communities that provide much needed housing and jobs in the community. Some private real estate firms are investing heavily in build-to-rent projects in an attempt to capitalize on growing demand for stable housing in suburban neighborhoods. With high occupancy rates and low competition from other sectors of the rental market, some investors may want to consider investing in built-for-rent single-family-rental properties for the possibility of cashflow. Investing in these types of rental properties may provide steady passive income. Built-for rent properties are structured with the intent to offer stability and as well as flexible exit optionality.
Potential benefits of investing in a built-for-rent subdivision
Investing in a built-for-rent subdivision can be an attractive financial opportunity for some investors. By investing in this type of subdivision, some investors may receive benefits such as low upfront CapEx costs compared to investment types that require more construction, rental income, and possible appreciation benefits. Some Wall Street institutional investors have mandates to acquire a high volume of units annually, which creates a pool of potential buyers for disposition of built-for-rent assets. Given the potential benefits build-to-rent properties may provide for some investors, it could be an asset class worth considering and discussing with your investment professionals. Investing in a single family built-for-rent subdivision is becoming increasingly popular. Whether you are looking for new asset classes to add to your portfolio or are interested in exploring investments with different income profiles, this type of real estate investment could be an interesting option for you. With the potential benefits involved, it’s easy to see why some private real estate investors are gravitating toward this asset class.
Investment considerations
Real estate is typically speculative and illiquid, so it is important to find the right opportunities when investing in build-to-rent properties that may mitigate the risks. One of the most effective ways to identify potential investments is through investment managers who specialize in private real estate. Firms like Fairway America have access to market intelligence and analysis that can help inform decisions about which build-to-rent properties may suit your particular investment criteria. Additionally, an investment manager can provide investors with more diverse acquisition options than an investor could access alone, and may have access to financing options that individual investors cannot replicate. Taking advantage of the expertise of a trusted investment manager and discussing potential investments with your investment professionals can better assure investors that they are making private real estate investments within the private real estate market that suit their individual investment priorities.
With the right management partner, investing in build-to-rent property can be a great way to start investing in new asset classes with the potential to provide benefits other asset classes may not provide.
Investing in real estate may be a means to build wealth for some investors. However, real estate investing can be risky, so there are several considerations if you want your investments to be successful. When looking for build-to-rent real estate, one important consideration is anticipated yield and market rents. You should also make sure that the property has good prospects for appreciation over time, based on its quality level and location. Working with an experienced manager can help you take some of the guess work out of this determination. If you’re considering investing in private real estate, investing in a variety of asset classes and properties may reduce your risk compared to investing in a single property or asset class. One way some investors may consider to accomplish this is by investing into a pooled fund. Lastly, don’t forget to factor in taxes when calculating your return on investment and always consult a financial advisor when considering any big investments. With careful thought and preparation, you could have the potential to build wealth through real estate investments.
The current economy is ripe with opportunity for investors who are interested in build-to-rent subdivisions. The potential benefits of investing in this type of property are many, and with the right location and management, your investment could be a success. If you’re ready to get started on finding opportunities to invest in built-for-rent subdivision properties, Fairway America can help. Our team has the experience and knowledge necessary to help you find investment opportunities that Fairway believes have a strong potential upside based on its own underwriting criteria and investment objectives. Ready to learn more? Contact us today at ir@fairwayamerica.com to discuss your options.
Nothing in this blog is or should be construed as investment advice or an offer or solicitation of offers of investments. Both Real Estate Investments and Securities offerings are speculative and involve substantial risks. Risks include, but are not limited to illiquidity, lack of diversification, complete loss of capital, default risk, and capital call risk. Investments may not achieve their objectives. Investors who cannot afford to lose their entire investment should not invest in such offerings. Consult with your legal and investment professionals prior to making any investment decisions. All Securities are offered through North Capital Private Securities, Member FINRA/SIPC.
