The Real Deal Miami

In South Florida, single-family rentals here to stay

Lack of job security deterring younger buyers
Single-family homes

Single-family homes

A single-family home rental industry run by Wall Street and hedge funds is a trend that is hear to stay, according to executives at a conference this month in Boca Raton.

“We love Palm Beach County,” said Jonathan Shechtman, portfolio manager for the Naples, Fla.-based Axonic Capital. “We really believe in the market and we think it’s stronger than other Florida counties.”

Many had speculated that home rentals would die off as values increased, but that’s not in the business plan, said speakers at the second annual Single Family Aggregation, REO to Rental Forum held at the Boca Raton Resort and Club, according to the Palm Beach Post.

“It used to be you get married, have kids, buy a house,” said Walter Charnoff, founder of Colorado-based RentRange, which provides information on the rental market. “But there was job security then. Now people are concerned they can’t keep their job and can’t sell their home if they have to move.” [Palm Beach Post] Christopher Cameron

  • Glenn E. Gromann

    A great concept. The problem with a lot of the SFR stock (particularly in certain pockets of Boca) is old and not properly maintained. There are many owners who cannot afford to live here and some of them are letting homes get run down. I would much rather have an institutional investor maintaining a home than a strapped homeowner. There is another group who own “tear downs” in good locations at a very low basis but are “holdouts” because they don’t understand a “present value” sale or inflation. They keep thinking valuations will rise when they don’t realize if they had sold at the top of the market in the last cycle the “present value” of their proceeds invested properly would be greater than any future appreciation–assuming there would not be another down cycle which would throw them in the negative. So much for financial literacy. This depresses the entire market and this type of inventory needs to be shaken out of the system before the next down cycle.