Real estate managers are again buying single family homes to rent, but assembling portfolios is harder because of the lack of widespread foreclosures, as was the case in the global financial crisis.
"There is a lot of interest but it is not as easy for people to expand and accumulate a portfolio," said Calvin Schnure, Washington-based senior vice president, research and economic analysis at Nareit, a real estate investment trust industry group.
Home prices are rising and at the moment, there isn't the steady stream of foreclosure auctions that existed after the 2008 crisis, he said.
S&P CoreLogic Case-Shiller U.S. National Home Price NSA index reported a 5.7% annual gain for the year ended Aug. 31, up from 4.8% the previous month, according to data released by S&P Dow Jones Indices in October. Home prices in Phoenix, Seattle, and San Diego increased the most in the year ended Aug. 31, rising 9.9%, 8.5%, and 7.6%, respectively.
REITs holding single-family home rentals are new, something that hasn't been seen since REITs starting going public in 2011, Mr. Schnure said. Performance for the three REITs in the FTSE Nareit Equity index was 9.5% for the past three years, three times the return of all the equity REITs in the index, he said.
