As home prices remain stuck on high and homebuilder activity slows, the demand for rental properties is soaring, along with rents.
Developers in the Tucson-area are eagerly building more communities of houses — not apartments — that are exclusively for renters.
Aerie Development, one of the early pioneers locally of the concept known as Built to Rent (BTR), has broken ground on its latest community in Oro Valley.
Linda Vista Luxury Homes will have 64 homes in a gated community at 375 W. Linda Vista Blvd.
The homes range in size from 781 square feet to 1,098 square feet and pre-leasing will begin next month for December delivery.
“With our ever-changing world, we are constantly revisiting how we do everything in our homes,” said Scott Rathbun, president of Aerie. “We specialize in peaceful, luxury living without the maintenance and stress of a mortgage.”
Aerie has 10 communities in the Tucson area, both BTR and luxury apartments.
Two more BTR projects are in the works, a 190-homesite on Catalina Highway and a 157-homesite in Gladden Farms.
Rental prices for the new developments have not yet been set but the rent for Aerie’s existing communities ranges from around $1,300 to $2,100 a month.
Of the top 20 metro areas with the most BTR homes, Tucson ranks 16th with 1,320. Phoenix takes the top spot in the country with 6,420 such homes.
Couples, with and without children, are driving the demand.
For some it’s necessity because home prices are high and mortgage rates are rising but others enjoy the low-maintenance lifestyle of renting.
“The trend combines the financial and leasing flexibility of a rental with the amenities and convenience of a professionally-managed property, all while living a single-family home lifestyle,” according to an analysis by RentCafe, a national search site for renters.
“Single-family rentals are not a new concept … although they proliferated in the aftermath of the 2008 housing crisis, this time it’s different,” the analysis says. “The pandemic created an unprecedented demand among renters for space and privacy, which houses can address much better than apartments.”
The number of BTR homes under construction across the country jumped to 13,910 this year, compared to 6,740 in 2021 — a 106% increase and the year isn’t over yet.
“Currently, there are about 90,000 existing single-family homes in the United States in nearly 720 such communities designed specifically for renting,” RentCafe data shows. “They include single-family detached houses, townhomes, duplexes, and even quadruplexes that come with a backyard or a garage — or sometimes both.”
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