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Over the past year, more single-family rental homes were built than the previous year. In the four quarters ending in Q2 2018, construction starts for this home grew by almost 45 percent.
The total starts for single-family rentals in this period was 42,000, and there were 13,000 starts in the second quarter of this year alone. According to analysis done by the National Association of Home Builders, the current share of single-family rental construction is higher than the historical average of 2.7 percent at 4.7 percent of all construction, while the cycle high was in 2013 at 5.8 percent, pushed up by Great Recession-era homeownership rate decline.
Of course, the built-for-rent share of single-family homes is considerably smaller than the single-family home portion of the rental housing stock, which is 35 percent according to the 2015 American Community Survey. As homes age, they are more likely to be rented. Thus, the primary source of single-family rental homes is not construction but the existing housing stock. In fact, from 2005 to 2015, 56 percent of the gains in the rental housing stock were due to increases of for-rent single-family homes.
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