The Evolution of Build-to-Rent: Why This Housing Model Is Growing

Build-to-Rent may feel like a new idea, but renting a single-family home certainly isn't. Americans have rented houses for generations. What's different about Build-to-Rent is that instead of individual homes becoming rentals over time, entire communities are intentionally designed, constructed, and professionally managed for people who want to rent.

That distinction has helped create an entirely new segment of the American housing market.

From Individual Rental Houses to Purpose-Built Neighborhoods

Traditionally, someone looking to rent a house would search for an individually owned property. The experience could vary considerably from one home to another. Different owners, different maintenance standards, different lease processes, and homes that were originally designed for homeowners rather than renters.

Build-to-Rent turned that model around.

Instead of asking, "Can we rent this house?" developers began asking a different question:

What would a neighborhood look like if it were designed specifically for people who want the lifestyle of a single-family home and the flexibility of renting?

The answer has taken many forms. Some Build-to-Rent communities feature detached single-family homes. Others include cottages, duplexes, townhomes, or a combination of housing styles. Many incorporate features traditionally associated with both residential neighborhoods and professionally managed apartment communities.

The result occupies an important space between conventional apartment living and homeownership.

And renters have responded.

Build-to-Rent Has Become a Meaningful Part of New Housing

The growth of purpose-built single-family rentals accelerated significantly during the early 2020s.

According to the National Association of Home Builders' analysis of U.S. Census Bureau data, approximately 80,000 single-family homes specifically built to be rentals began construction during the four quarters ending in the first quarter of 2024 — nearly 16% more than during the preceding four-quarter period.

By the four quarters ending in early 2025, that figure had climbed to approximately 84,000 new single-family Build-to-Rent starts.

Those figures don't capture every new Build-to-Rent home, either. The NAHB data measures homes that builders construct and retain for rental purposes. Homes built and subsequently sold to another operator for rental use aren't included in that count; NAHB estimates those transactions could represent another 3% to 5% of single-family housing starts.

Growth has recently moderated as higher financing and construction costs have made some new developments more difficult to pencil out. But the larger shift has already occurred: purpose-built single-family rental housing has established itself as a distinct part of the American housing market.

So what created the demand?

The American Renter Has Changed

Part of the answer is demographic.

The stereotypical renter was once imagined as someone young, single, and temporarily living in an apartment until they were ready to purchase their first house.

Today's rental population is far more diverse.

Renters include young professionals, couples, families with children, established Gen X households, retirees, empty nesters, military households, remote workers, people relocating to new cities, and former homeowners who simply don't want the responsibilities of owning another house.

For some, renting is still a step toward homeownership.

For others, renting is the preferred lifestyle.

That distinction matters.

Someone can want another bedroom, a front door, room for a dog, outdoor space, neighborhood streets, and greater privacy without necessarily wanting a mortgage.

Build-to-Rent exists largely because the housing market historically offered surprisingly few purpose-built choices for that person.

Homeownership Has Also Become More Difficult to Reach

Lifestyle preference is only part of the equation. Economics have played a major role in BTR's growth as well.

Home prices have risen substantially faster than household incomes over the long term, making homeownership increasingly difficult for many households. Urban Institute research has documented the growing affordability challenge facing younger households in their prime homebuying years.

Higher home prices aren't the only hurdle. Buyers must also consider mortgage rates, down payments, closing costs, property taxes, homeowners insurance, HOA fees where applicable, repairs, and ongoing maintenance.

That creates an interesting group of consumers:

People who are financially established enough to want more from their housing, but who either can't purchase the home they want or have consciously decided they don't want to own one right now.

For them, the choice doesn't necessarily have to be "buy a house or settle for an apartment."

A professionally managed rental home creates another option.

More People Want Space Without the Responsibility

The pandemic accelerated another housing shift: people began thinking differently about the role their homes play in everyday life.

A home became more than somewhere to sleep after work. For many households, it also became an office, gym, classroom, entertainment space, pet playground, and place to spend significantly more time.

Even as daily life normalized, many of those expectations remained.

Extra bedrooms became offices. Outdoor space became more valuable. Privacy mattered more. Having a garage, storage space, or simply some separation from neighbors became meaningful lifestyle considerations.

Research from the Urban Institute describes Build-to-Rent as an important source of new housing supply for households that prefer single-family homes but don't want - or aren't ready for - the responsibilities of homeownership.

That may be the simplest explanation for why BTR works.

People didn't suddenly stop wanting houses. They started questioning whether owning one was the only way to enjoy living in one.

America's Housing Supply Created Another Opening

Build-to-Rent is also developing against a larger national housing shortage.

NAHB estimates that the United States needed approximately 1.2 million additional housing units as of 2024 to bring metropolitan housing vacancy rates back toward historical norms.

At the same time, demand for rental housing remains substantial. The U.S. renter population grew by approximately 848,000 households in 2024 alone, according to figures highlighted in the 2025 State of the Nation's Housing report.

America doesn't simply need more apartments or more houses for sale.

It needs more housing choices.

Build-to-Rent adds another type of inventory to that equation: homes for households seeking more space and privacy without entering the for-sale market.

BTR Isn't Replacing Apartments or Homeownership

It's important not to frame Build-to-Rent as the "winner" in a competition against apartments or owning a home.

Each serves a different need.



Apartments can provide exceptional amenities, efficient floor plans, convenient locations, and affordability. Homeownership can provide permanence, the ability to customize a property, and the opportunity to build equity.

Build-to-Rent fills the space between them.

For someone who loves the convenience of renting but has outgrown the traditional apartment experience, BTR can represent a natural next step.

For a homeowner ready to sell but not ready to give up the privacy and independence of living in a house, it can provide a compelling alternative.

For someone relocating to a new city, it can offer the opportunity to establish roots without immediately purchasing property.

And for a household that simply prefers flexibility, it makes renting a long-term lifestyle choice rather than something that needs to be "graduated" from.

The Bigger Shift: Renting Is Becoming a Housing Choice, Not a Housing Type

That may ultimately be the most important part of the Build-to-Rent story.

For generations, the type of home someone wanted often determined whether they needed to rent or buy.

Want an apartment? Rent.

Want a house and neighborhood? Buy.

Build-to-Rent breaks that connection.

As more purpose-built rental neighborhoods enter the market, renters have access to housing types that historically belonged primarily to homeowners. That means choosing to rent no longer has to determine whether someone can enjoy a yard, a private entrance, neighborhood living, additional bedrooms, or the feeling of coming home to a place that actually feels like a home.

Build-to-Rent isn't replacing the American dream of homeownership.

It's expanding the definition of what the American renter can expect from home.

And that brings us to the question many prospective residents ultimately ask:

If Build-to-Rent gives you many of the benefits of living in a house, how different is it really from living in an apartment?