Atlanta Journal-Constitution Fails in its Reporting on the Single-Family Rental Home Industry
Over the past week, the Atlanta Journal-Constitution has published a series of articles on the single-family rental home industry that can only be understood as a quixotic and aimless attempt to villainize an industry that has been a critical part of Atlanta’s housing market for decades. In the process, the AJC has brazenly impugned the motivation of all owners and providers of single-family rental homes throughout the Atlanta region who work diligently to provide residents with quality, affordably-priced, well-located, and in many cases, professionally-managed, single-family rental homes.
Most disturbing about the AJC series of articles is the almost complete – perhaps intentional – lack of context and perspective necessary for readers to appreciate fully the role of the single-family rental home industry and the positive contributions of housing providers and homebuilders across the Atlanta market.
NRHC regularly engages with reporters covering the single-family rental home market and we welcome and respect legitimate inquiry and examination into any aspect of the industry that might be newsworthy. In the case of the AJC series, NRHC, along with industry companies, participated in interviews and other activities designed to provide information, market data, and insights. We also provided access to local industry experts and academics. Finally, we provided a fact-based presentation on the single-family rental home industry, containing both national and local market data and information. The AJC inexplicably chose to use virtually none of it.
This post serves as an attempt to present many of the facts that were not included in the AJC series as well as address distortions presented in the articles.
First, market data does not support in any way the AJC’s outlandish claim that, “metro Atlanta is ground zero for the takeover of the American Dream.” There are nearly 4.5 million housing units in Georgia, 726,000 of which are single-family rental homes. Member companies of the National Rental Home Council (NRHC), which include the nation’s largest providers of single-family rental homes, own approximately 37,500 homes across the state (member reported data). This equates to about 0.8% of the state’s residential housing and just 5.2% of the number of single-family rental homes. Further, NRHC data show the share of both the Georgia and Atlanta metro housing markets accounted for by single-family rental homes was less in 2022 than it was in 2016.
Sources: Annual Social and Economic Supplement of the Current Population Survey, US Census Bureau, IPUMS, National Rental Home Council; Data are Through 2022
Second, the AJC makes much of the reported claim that “institutional investors” purchased 65,000 homes in the Atlanta market over the last decade. We won’t quibble with the AJC’s numbers – though there is much to contest – but rather will focus on putting those numbers in context. Currently, there are nearly 2.5 million housing units in the Atlanta region. In 2012 (10 years ago) there were approximately 2.2 million housing units. If “institutional investors” purchased on average 6,500 homes per year during that 10-year period (65,000 over 10 years), that means they would have purchased less than one third of one percent (0.03%) of the total housing units in the Atlanta metro area (using the 2012 figure of 2.2 million housing units). Granted, this calculation is not scientific or based on actual data from those years, but it does provide much-needed context.
And, as if further context were needed to bring clarity to the AJC’s reporting on investor purchases, real estate firm Redfin reported on February 16 in their quarterly study of investor trends in the housing market, “Investor home purchases fell a record 45% year over year in the fourth quarter.” In the Atlanta market, investor purchases declined by 62.8%.
Third, AJC’s implication that providers of single-family rental homes are somehow adversely impacting homeownership in Atlanta is clearly dubious. In all eight counties comprising the metro Atlanta region, the homeownership rate is higher today than it was five years ago.
Source: Federal Reserve Bank of St. Louis; FRED Economic Data
Freddie Mac, in an important recent study, found homeownership has, in fact, been growing nationwide, with notable increases by first-time homebuyers. And though more needs to be done to reduce the racial homeownership gap, the Urban Institute has reported both black and latino rates of homeownership growth exceeded that of white homeownership growth between 2019 and 2021.
Fourth, the AJC neglects to provide almost any context when it claims “Investors slam tenants with fees, evictions.” In 2022, the U.S. House Financial Services Committee released a report containing eviction data for the five largest companies in the single-family rental home industry. The committee’s data show in 2018, the eviction rate for the five largest companies was 0.4%. In 2021, the rate was 0.05%.
Fifth, demand for rental housing is directly correlated to population growth and job growth, and on both fronts the Atlanta region is booming. According to U.S. Census Bureau data, the population of metro Atlanta increased by 43,000 people between July 2020 and July 2021 – approximately 117 per day – the sixth highest rate of growth for all metropolitan areas in the country. The metro Atlanta employment market added more than 184,000 workers between April of 2021 and 2022, more than all but four metros across the country with populations greater than one million. As Atlanta’s economy continues to attract new residents and businesses, the supply of rental housing will have to expand accordingly.
Finally, the real challenge facing the nation’s housing market is supply, or lack thereof, not the role of rental housing providers. This is seen most immediately in high-growth markets like Atlanta, and throughout the state of Georgia. Over the past decade, the population of Georgia has grown by nearly one million individuals, while the state’s housing stock has grown by less than 350,000 units. Atlanta, in particular, ranks ninth of 309 metro areas in the level of housing underproduction with a shortage of almost 100,000 homes.
Source: Bipartisan Policy Center: J. Ronald Terwilliger Center for Housing Policy
As further indication of the supply challenges confronting the housing market, the state of Georgia issued only slightly more building permits in the 2010s than were issued in the 1970s.
Source: Bipartisan Policy Center: J. Ronald Terwilliger Center for Housing Policy
Providers of single-family rental homes are committing significant resources to the Atlanta market for one reason: demand. Companies are investing in local staff, hiring local contractors and business partners, and bringing property management expertise to the local market all to ensure a positive experience for residents and families who choose a single-family rental home lifestyle. As evidence, NRHC member companies invested nearly $2 billion in home renovations, upgrades, and other property-level operations in 2021, and many of NRHC’s largest member companies maintain an A+ rating from the Better Business Bureau.
The Atlanta area housing market should be one that reflects the diverse needs and circumstances of those who call this vibrant and dynamic region home. Single-family rental home providers are an important part of the housing ecosystem in Atlanta, throughout Georgia, and across the country. As testament to the role of single-family rental homes in neighborhoods and communities, a report by Harvard’s Joint Center for Housing Studies and AARP in 2021 found, “the most livable neighborhoods offer the most diverse set of housing options, including multifamily and rental opportunities as well as single-family and owner-occupied homes.”