Key Takeaways: Following our best idea presentation on AMH last week, we wanted to follow up with some interesting data points on institutional interest in the SFR space. Redfin tracks and recently published interesting data points HERE on the resurgence of investor purchases of single-family homes (incl. Blackstone recently). On balance, we see the data as very supportive of the long-term SFR long thesis in general, but in particular AMH with its captive "bank" of lot inventory and unique development program set against an extremely tight supply environment. As the space matures and grows more competitive given the outsized yield opportunities, operators with pre-sourced inventory to control, build and deliver have a massive advantage:
- U.S. home purchases by investors (defined as institutions or businesses versus individuals) increased Y/Y in 1Q21 for the first time since the pandemic began
- Investor purchases amounted to 14.9% of total homes purchased in the quarter, still below prior peak of 16.1% in 1Q20 but a rebound from the massive drop seen over 2Q20-4Q20 (see Figure 1 below)
- Furthermore, SFR saw the biggest increase in investment among different residential product types (see Figure 2 below)
Figure1:
Figure 2:
