How Wall Street’s Push Into Single-Family Rentals Is Reshaping Long-Term Renting in America

From owner nation to renter growth story

For decades, U.S. housing has been described as a nation of owners. Yet the past quarter-century tells a more nuanced story: the rental side of the market has grown substantially even while the overall homeownership rate has stayed relatively stable.

Scotsman Guide, citing Census and Point2Homes data, reports that the U.S. added nearly 10.5 million renter households between 2000 and 2024. Over the same period, the homeownership rate peaked at 67.3% in 2006, fell in the aftermath of the financial crisis, and stood at about 65.3% in 2024. In other words, a much larger population is renting even though the ownership share of households remains in the mid‑60% range.[scotsmanguide.com]

Several forces are at work. Home prices and mortgage rates climbed sharply in the 2020s, making it harder for many households – especially younger buyers – to save for a down payment or qualify for a mortgage. Inflation outpaced home price gains more recently, shifting the emphasis for investors from quick appreciation toward steady rental cash flow.[scotsmanguide.com]

Where rentership is rising fastest

Rentership is not rising evenly across the country. According to the Scotsman Guide analysis of Point2Homes data, Nevada, Texas and North Dakota have each seen more than 50% growth in renter households since 2000.[scotsmanguide.com] These states, along with others like Washington, Oregon and Florida, have attracted population and job growth that outpaced the supply of for-sale homes.

At the city level, 43 cities shifted to renter‑majority status over the past 25 years, compared with 18 that moved in the opposite direction.[scotsmanguide.com] States with the highest renter shares in 2024 included New York, California, Nevada, North Dakota, Hawaii and Texas, all with rentership rates well above one‑third of households.

This geographic pattern is crucial for investors and builders. Many of these high‑growth markets offer strong job bases, but ownership has become expensive or constrained by limited inventory and land. Long-term renting becomes a practical, sometimes preferred, option – especially for mobile workers and households uncertain about staying in one location for decades.

Why single-family rentals fit the new renter profile

The composition of renter demand is also changing. As Scotsman Guide notes, many renters today are not looking for traditional Class A or B garden‑style apartments.[scotsmanguide.com] Instead, a growing share want exactly what for‑sale buyers seek: a single-family home with a yard, privacy and access to good schools.

This is where single-family rentals (SFR) and build-to-rent (BTR) communities come in. Rather than competing only in the resale market, investors and developers are increasingly building entire neighborhoods of detached or attached single-family homes specifically to rent. These properties offer the space and neighborhood feel of ownership, but with the flexibility of renting and without the upfront down payment or long-term maintenance responsibilities.

For families who expect to rent for many years – whether by choice or necessity – SFR and BTR homes can provide stability and community. Long-term leases, professional management and purpose-built amenities (like playgrounds or dog parks) make these communities particularly appealing to households who might once have moved straight from apartments into starter homes.

How institutional capital and lending models are scaling the sector

Investor activity has played an increasingly visible role in single-family housing. Scotsman Guide notes that nearly one-fifth of all U.S. single-family homes are owned by real estate investors, highlighting how large this ownership slice has become.[scotsmanguide.com] Demand from investors surged during the pandemic years, when low borrowing costs and rapid price appreciation created strong returns.

Even after a historic rate-driven slowdown, investors remained active. In the first half of 2025, investors purchased around 85,000 homes per month, slightly above the average for the same period in 2024, although still below the 2021 peak.[scotsmanguide.com] That continued appetite is increasingly directed at rental strategies rather than quick flips.

Financing tools have evolved alongside this trend. Debt-service coverage ratio (DSCR) loans, for example, allow borrowers to qualify based on a property’s projected rental income rather than solely on personal income and debts. Scotsman Guide highlights DSCR loans as a popular business-purpose product for building rental portfolios, particularly in the single-family rental space.[scotsmanguide.com]

Institutional investors and large private funds have used a mix of DSCR lending, securitizations and joint ventures with builders to scale SFR and BTR platforms. Their ability to buy or build at volume can add significant rental inventory quickly, especially in fast-growing Sun Belt markets.

Market impacts: help for renters, headwinds for first-time buyers

The growth of SFR and BTR brings both benefits and trade-offs. On the positive side, professionally managed rental homes expand options for households that need or prefer to rent long term. In markets where new for-sale construction has lagged population growth, purpose-built rental neighborhoods can relieve some pressure on older housing stock and provide modern, energy-efficient homes for renters.

At the same time, increased investor competition in the lower price tiers can make life harder for first‑time buyers. Scotsman Guide notes that investor activity in more affordable segments can crowd out entry‑level purchasers, particularly when investors can pay cash or waive contingencies.[scotsmanguide.com] For households trying to transition from renting to owning, this dynamic can extend the period they must remain renters, reinforcing the very trend investors are addressing.

Local impacts vary widely. In some metros, investors concentrate in specific suburbs or school districts, reshaping entire neighborhoods into predominantly renter communities. Elsewhere, small and mid-sized investors, rather than national platforms, still control most of the rental single-family stock.

What to watch if you’re an agent, lender or small investor

For housing professionals, the shift toward long-term renting and single-family rentals has several practical implications.

• **Agents** may find that a larger share of clients are long-term renters who still want neighborhood guidance, school insight and lease negotiation help. Understanding SFR and BTR communities – and their ownership structures – becomes part of local market expertise.
• **Lenders** can explore business-purpose products tailored to small investors building SFR portfolios, while managing concentration risk in markets with heavy institutional presence.
• **Small investors** might focus on niches where large players are less active, such as secondary or tertiary markets, value‑add rehabs, or smaller infill projects that don’t meet institutional scale thresholds.

Looking ahead, the balance between rental and ownership housing will depend on how affordability, construction and lending standards evolve. But the data suggest that “renting for the long run” is no longer a niche pattern – it is a structural feature of today’s housing market. For better or worse, Wall Street’s growing role in single-family rentals is likely to remain part of that story for years to come.[scotsmanguide.com]