PHOENIX, Arizona (October 24, 2022) – Trevor Koscovich, President – An investment sales rep recently shared his insights on the Single Family Rental/Lease (BTR) market in a published article. business insider Title: “Online real estate investment firm Fundrise pays well above home market value for some build-to-rent communities. This is why it’s still said to be a winning strategy.”
The story used Cypress Bay-Homes for Rent as a case study of the reasons behind Fundrise’s recent purchase. The company said he bought this community in 2022 with his $45.7 million in debt and equity, bringing the average price per home to $525,287.36. This is 42% higher than the starting price of the most expensive model and significantly higher than the smaller model homes. But it’s clear that the Fundrise made a lot of money when Cypress Bay was rated as an apartment complex rather than a residential complex.
Koskovich explained the historical context of the market environment in which Cypress Bay existed and how it fits into the larger trends observed in BTR. The same bidding dynamics that existed in the traditional housing market also exist in these large communities. It was not uncommon for him to receive 10 to 15 bids for each of these types of assets, Koskovich said, but did not provide comment on specific deals.
“We were going through a lot of the same things people were trying to buy a house,” Koscovich said. “The property goes public for $700,000 but ends up selling for $850,000. The same story was happening in our industry, except we exchanged thousands for millions. .
This dynamic has outpaced home prices for some time, and Koscovich says many homes are selling to institutional investors more than to owners in the same area.
Other topics include:
- How will the housing market affect the BTR
- Funding vs. Other Innovators (and Critics)
- How to Evaluate Build-to-Rent Communities
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