Here’s how the build-to-rent boom is re-shaping Phoenix

By: AZ Big Media 

Phoenix is ground zero for a new multifamily housing product gaining popularity across the nation: single family build-to-rent (BTR) communities. Sometimes referred to as low density multifamily or horizontal apartments, these BTR developments offer another option for renters who don’t want to live in multistory apartment buildings but can’t or won’t commit to a home purchase.

Would-be homeowners in Metro Phoenix have seen listings vanish nearly as soon as they appear online, sent in offer after offer only to be outbid by a cash buyer all while prices soared — home values are up 22% year-over-year, according to Zillow’s Home Value Index data.

To be sure, indicators such as increased inventory levels are showing a cooling of the housing market. Rising mortgage rates also discourage buyers from making a purchase — since much more of their monthly payment would go to interest — and instead they are pursuing other options, such as renting or simply staying put.

Brandon Harrington, managing director at NorthMarq, says that elevated home prices and the current interest rate environment make it difficult to qualify and afford a home mortgage, which is driving demand for multifamily options like BTR communities.

“I’m super bullish on multifamily, BTR and all forms of housing, because we do have a lack of supply,” Harrington explains. “We have major population growth, and we have huge job growth. A lot of those jobs aren’t even here yet, so I think we’re going to continue to see huge demand for housing going forward.”