Top SFR Markets Ripe for Investors

Large institutional investors dominate most of the major markets for single-family rentals, but a new report from ATTOM Data Solutions shows that these investors haven’t found all the hidden gems yet.

In its look at markets with high-yield potential, ATTOM found 28 that large investors have missed and that have, as a result, seen less drama in terms of escalating rents.  The list identifies only those counties where institutional investors (those entities purchasing at least 10 properties in a calendar year) account for less than 3 percent of all single-family purchases so far this year. These markets are also where the potential gross annual rental yields is at least 10 percent.

For once, the list topped by Camden County, New Jersey, and Macomb County, Michigan, which houses Detroit, is not one involving crime. According to ATTOM, Camden County tops the list of potential single-family rental growth markets, with an almost 12-percent potential gross annual yield. Macomb is a close second, with a, 11.4 percent potential gross annual yield.

Philadelphia County, Pennsylvania, across the river from Camden County, has a 10.1, as does Detroit neighbor Kent County. Ocean County, New Jersey, also has good potential, showing 10.4 percent possible annual gross.

Ocean and Kent counties also made it to the top of ATTOM’s list of counties where institutional investors had the lowest share of purchases‒‒0.9 and 1.3 percent, respectively. Atlantic County, New Jersey, and Richmond City, Virginia, had 1.3 percent investor purchases, and Ulster County, New York had 1.5 percent.

Philadelphia, however, had the highest percentage of investor purchases so far this year, with 3.6 percent.