The Way People Invest In Real Estate Has Changed – What This New Strategy Means For Investors

Residential rental properties have been the most common investment option for most people wanting to build wealth through real estate investing. A modest savings account could cover the down payment on a single-family home in many parts of the country, and an ambitious investor could scale that first purchase into a multi-million dollar portfolio.

Institutional investors mostly stayed out of the single-family housing market. Hedge funds and private equity firms historically maintained their focus on commercial real estate and large multifamily properties, leaving retail investors to dominate the rental property space.

The dynamic has been slowly shifting in the residential real estate market since the Great Recession in 2008, but this shift has been accelerating over the past couple of years. Seeing the major growth potential in new markets because of shifting migration trends and a growing need for affordable housing, many institutional investors are aiming their focus on single-family rentals.

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Source: Yahoo Finance