Have you noticed the Build-to-Rent Trend? Build to rent is has become more common due to the shortage in the supply of properties. However, what must you know as an Alabama homeowner? How does the shortage of properties affect you? Should you build to rent? Are build-to-rent properties worth investing in if you’re looking for a home in Alabama? This article tells you what you must know about the build-to-rent trend in the real estate market.

What Is a Build-to-Rent Home in Real Estate?

Just as suggested by the name, a build-to-rent home is a property that was designed to be rented out. The major difference between modern build-to-rent homes and previously rented properties is that these homes are specifically designed from the onset to be rented. At the same time, home rentals are as old as living in homes themselves.

Build to rent homes in real estate are often:

  • Small lot homes: these are often portable individual homes close together.
  • Row Homes: have you come across a row of houses joined by common sidewalls that seem to share the same design and structure? The chances are that they are row homes built for rent. 
  • Duplexes: build-to-rent houses can also be structured so that it is divided into two separate units for different houses.
  • Horizontal Apartments: build-to-rent homes could also be a large clustered property consisting of numerous units of professionally-managed single-family residences with high-end amenities.

Pros and Cons of a Build-to-Rent Home?

To Renters:

Pros
  • You experience the comfort of homeownership without the worry of homeowners (repairs, maintenance, etc.)
  • You have access to a tightly knit community.
Cons
  • Build-to-rent property rents are often higher than rents for apartments
  • The cost of living in build-to-rent homes are higher relative to homeownership
  • Build-to-rent homes are often smaller
  • You do not keep the freedom to remodel your home

To Investor:

Pros
  • You may make higher profits
  • It is a less competitive way to enter the real estate market
  • It is a chance for a residual income stream
Cons
  • It is often difficult to compete with large-scale operators in the game
  • Getting a good ROI may be rather difficult
  • It requires significant capital
  • Should you build a home to rent?
  • Building a home to rent could be a profitable investment in the long run. However, it is not an investment from which you should expect enormous returns in the short term.

Should You Rent a Build-to-Rent Home?

Renting a home rather than outrightly making a property purchase might be a very attractive option, especially if you:

  • Want freedom from maintenance stressors
  • Want to have a sense of community
  • Are you looking for temporary accommodation
  • Are not willing to save for a property purchase down payment
  • Want a home that comes with luxury features

Build-to-Rent Trend: Conclusion

Ultimately, the question of whether or not to get a build-to-rent home depends on your reason for getting one. Renting a BTR home in real estate is a great option for you if you check all the boxes above. However, for a family looking to get a permanent residence, purchasing a home might be a more economical option in the long run.

Can’t build a home to rent? No worries, you can still sell your home easily without stress at a competitive price. Have Rhedkeys handle your house sale, and you’d have your cash in no time-No hidden charges.