New homes built for the purpose of renting are having a resounding moment, rising high on the shoulders of hybrid work and Millennials who are reaching their prime nesting years, but who are also finding homebuying challenging. Combine renter demand with interest from institutional investors and well-established builders and it’s safe to say we’re witnessing this niche at its historical peak.

In 2023, nearly 27,500 build-to-rent houses were completed, an all-time high. What’s more, this was 75% more than the year before and triple the number in 2021. Of course, the appeal of living in a house with a private backyard (albeit a small yard, in many cases) seemed even more irresistible after the pandemic. As a result, the number of single-family homes for rent built every year jumped from an average of 6,600 in the pre-pandemic years to tens of thousands of new units each year after that.

10-Year Evolution of New Build-to-Rent Homes

*Only completed build-to-rent units.

Source: RentCafe analysis of Yardi Matrix data

This momentum has led to more than 45,400 build-to-rent houses now under construction that are expected to welcome renters in the next couple of years. While the bulk of these should open their doors in 2025, we anticipate a moderation of this fast-paced construction rush.

So, which areas are seeing the largest numbers of new build-to-rent homes? The Phoenix metro area led the way by far with more than 4,000 units completed in 2023, followed by Dallas and Atlanta. Then, Austin, TX, and Charlotte, NC, rounded out the top five metro areas with the highest numbers of houses for rent that opened their doors last year.

However, this adaptation of the American Dream is expanding beyond the traditional Southwestern markets and into Florida and even the Bay Area. In fact, nearly 8,300 rental homes are currently underway throughout Florida, while another 2,400 are under construction in California.

Build-to-rent boom: 14 of 20 top metros achieved 10-year highs

After 2022 marked a record year for build-to-rent development, 2023 exceeded expectations with close to 27,500 rental homes completed nationwide. And, more than half of these homes are in the top 20 metros with the largest number of units added last year, 14 of which achieved 10-year highs.

Phoenix is the reigning metro with 4,030 single-family homes for rent opening their doors in 2023, a 10-year high and an impressive 164% growth compared to 2022. Granted, Phoenix is blessed with the opportunity of building out, rather than up (like in major coastal locations), so this desert city continues leveraging the popularity of build-to-rent homes. Plus, the area is also one of the fastest growing in the country when it comes to population, which also helps new communities fill up before their official openings.

Next, Dallas followed with roughly 2,700 rental homes built in 2023, a slight decrease compared to the year before, but still its second-best year for build-to-rent construction in a decade. For context, Texas was the leading state for build-to-rent development in 2023 with nearly 4,800 houses for rent completed. The Dallas metro accounted for more than half of these units.

Top 20 Metros for Build-to-Rent Completions in 2023

Source: RentCafe analysis of Yardi Matrix data

Then, the Atlanta metro was third in our top 20 with almost 2,000 single-family homes for rent completed in 2023 for another 10-year high. Here, too (like in most metros in our top 20), the build-to-rent construction trend really took off in the last five years. This translated into more than 3,500 single-family homes for rent built between 2019 and 2023 versus just 217 between 2014 and 2018.

Next up were Austin and Charlotte with 840 and 714 houses for rent, respectively, added in 2023. While the Texas metro saw a 159% rise in new units compared to 2022, the North Carolina renter hotspot marked a 13% increase in that same timeframe.

The Midwest was also well-represented on our list thanks to Kansas City, MO; Columbus, OH; Akron, OH; and Indianapolis. Seventh on our list, the Kansas City metro deserves a special mention after managing to ramp up its build-to-rent activity and open 636 new units in 2023 — a particularly notable jump compared to just 80 houses that were finished here in 2022.

On another note, Texas (4,800 units), Arizona (4,000 units), Florida (2,800 units), Georgia (2,181 units) and South Carolina (1,909 units) were the top five states for build-to-rent activity in 2023.

Newest build-to-rent houses are available in Texas, Florida and even California

In addition to privacy and extra space, renters are also drawn to single-family homes for rent because they’re new and decked out in up-to-date amenities. In fact, 41% of the total number of build-to-rent homes were built in the last five years. That’s about 68,000 rental homes.  

When it comes to the metros with the largest numbers of new houses for rent that were built in the last five years, Phoenix was again at the top with more than 9,300 units. Specifically, the Valley managed to quadruple its supply between 2019 and 2023: Close to 80% of the total number of houses for rent in Phoenix were added in this timeframe.

Top 20 Metros for New Build-to-Rent Homes in the Last 5 Years

Source: RentCafe analysis of Yardi Matrix data

Texas had four metros in our top 20, starting with Dallas at #2 with more than 6,500 single-family homes for rent built in the last five years. That’s 62% of all homes for rent in the metro. Next were Houston at #4 with 2,400 units and Austin at #7 with 1,700 units. Not far behind was San Antonio, which came in ninth on our list with 1,300 houses for rent built between 2019 and 2023.

That said, Atlanta (third) and Charlotte (sixth) each deserve a mention for the most significant increases in their build-to-rent supply. Atlanta’s rose seven times in the last five years to a total of nearly 4,100 houses for rent, while Charlotte’s skyrocketed from just 185 units to more than 2,200 in that same timeframe. To that end, 92% of Charlotte’s single-family homes for rent opened their doors between 2019 and 2023.

Sunny California and Florida metros also ranked high on our list. More precisely, Jacksonville, FL, was 10th with close to 1,300 single-family homes for rent completed since 2019 while Tampa tripled its number of build-to-rent houses by adding 1,100 units in that same period. Out on the West Coast, the Riverside, CA, metro completed more than 1,000 houses for rent in the last five years to bring its total supply to more than 4,400 units.

Top 100 Metros for New Build-to-Rent Homes in the Last 5 Years

Source: RentCafe analysis of Yardi Matrix data

Emerging metros for single-family houses for rent are in Florida, North Carolina

Nationwide, there are 32 metros with their entire build-to-rent supply completed in the last five years. However, more than half don’t have any new projects underway. For this reason, we selected the ones that had the largest numbers of built houses for rent and significant developments underway to highlight them as emerging build-to-rent markets.

First is Florida’s North Port metro with its 749 rental homes built between 2019 and 2023 and 994 currently underway. Next are Raleigh in North Carolina with 743 fresh homes and 355 more under construction, as well as Lakeland in Florida with 489 units already built and 317 more coming up.

Also in the South is Savannah, GA, which has 400 newly built houses for rent and 1,000 underway. Not to be outdone, Michigan’s Ann Arbor is also a new build-to-rent market with 267 rental homes opened between 2019 and 2023 and 632 more under construction. That said, none of these get even close to Huntsville in Alabama, which is getting ready to add almost 2,500 new houses for rent to its existing 262 units. Accordingly, the city is gearing up to become the largest in the state with the Port of Huntsville seeing immense growth, creating jobs and attracting new residents.

Texas has most build-to-rent units under construction, Phoenix is top metro for projects underway

After years of record completions, the wave of build-to-rent projects peaks this year with nearly 45,500 new houses under construction. The top five metros with the largest numbers of units underway — Phoenix, Dallas, Houston, Huntsville and Charlotte — account for half of the total volume.

Phoenix — the largest build-to-rent market in the country — will add more than 7,200 new houses for rent to its current portfolio of 12,400 units, further solidifying its status. Similarly, Texas metros Dallas (#2) and Houston (#3) are working on 6,500 and 4,800 new single-family homes for rent, respectively, by 2026. These will pile upon the current 15,600 units in the Lone Star State — the state with the most significant build-to-rent supply.

Top 20 Metros With Most Build-to-Rent Units Under Construction

Source: RentCafe analysis of Yardi Matrix data

Speaking of productive states, Florida stands out with four locations in our top 20 metros for build-to-rent homes underway. Specifically, Jacksonville, Tampa, Orlando and North Port have a total of 5,300 houses expected to welcome renters in the next couple of years. Also on our list, Salt Lake City; Nashville, TN; Columbus; and Savannah each have more than 1,000 new rental homes underway.

Meanwhile, sunny California is also well represented in our ranking with Riverside and Sacramento at #18 and #19, respectively, each with around 900 homes under construction. And, in the Mountain region, we have Denver, which is 20th on our list with nearly 800 single-family homes for rent to be delivered in the next two years, a significant jump compared to the 174 new homes added in 2023. As a matter of fact, nearly all of Denver’s total 1,300 units were built in the last five years.

Clearly, construction activity picked up significantly in the post-pandemic era. Even so, predictions outline a slight moderation in the pace of deliveries in the years to come.

Methodology

RentCafe.com is a nationwide apartment search website that enables renters to easily find apartments and houses for rent throughout the United States.

This study is exclusively based on data related to build-to-rent communities containing at least 50 single-family rental units.

This analysis was performed by RentCafe using data provided by our sister company, Yardi Matrix. The data includes only properties defined as single-family homes for rent that are located in build-to-rent, professionally managed communities in the markets covered by Yardi Matrix research. Data for some markets may not be available and data for the locations included in the analysis may be subject to change. This analysis does not include other types of single-family rentals that are not located in build-to-rent communities.

Build-to-rent communities are defined by Yardi Matrix as communities where at least 50% of the units fit one of the following criteria: (1) They do not share any walls with other units, or (2) they have shared walls, but do not have neighbors above/below or have a direct-access garage.

For the purposes of this study, we considered as “completed in 2023” only units that received a certificate of occupancy by the end of December 2023. Units under construction either have not yet received an official certificate of occupancy or are currently being built. Under construction data may be incomplete and is subject to change.

Written by Alexandra Both

Alexandra Both is a senior creative writer with RentCafe.com. She has more than six years of real estate writing experience as a senior editor with Commercial Property Executive and Multi-Housing News. She is a seasoned journalist, who has previously worked in print, online and broadcast media. Alexandra has a B.A. in Journalism and an M.A. in Community Development.