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Single-Family Rentals and the Art of Neighboring

Jeremy Edmiston • 12/8/2022

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On any given day, you’ll find Claudia Finney sporting sunglasses and walking her two dogs, Cooper and Lula, through The Havenly Fountain Hills, a single-family, detached-home neighborhood about 20 minutes northeast of Phoenix, where she and her husband Kelly rent one of the 147 houses in the gated community.  

“It’s perfect for us,” she said, of the newly built, 1,421-square-foot, two-bedroom, two-bathroom lofted house with stunning vistas of the McDowell Mountain range and views of the famous 330-foot fountain at the center of Fountain Hills, one of the largest fountains in the world. “It’s beautiful, it’s the perfect location and it feels like we own it, even though we don’t.”  

The Finneys aren’t alone in eschewing homeownership right now. Both in their early 60s, they represent a growing number of people—from Millennials to mid-career professionals to retirees—who find themselves drawn to housing that offers a single-family lifestyle without the long-term commitment, maintenance and financial burden that often accompany homeownership.  

The pandemic accelerated this trend across the U.S. As more people left congested urban areas seeking suburban space to accommodate working from home and remote school, the housing inventory tightened. Home prices soared, bidding wars became the norm and soon thereafter a surge in demand for single-family rentals. According to our research, more than 60,000 built-to-rent single-family rental units were built in 2021 in the U.S., in cities like Memphis, Oklahoma City and Forth Worth. Single-family rentals were especially desirable in cities like Austin, where, according to the Burns Single-Family Rent Index, home values rose 38% in 2021, but where average single-family rental rates increased just 6%. 

The Havenly Fountain Hills is just one example of built-to-rent, single-family housing that exploded in the past year, increasing 63% from 2021, according to the National Association of Homebuilders. Like many built-to-rent, single-family communities, it offers residents multiple floor plan options, luxury finishes and fenced backyard spaces. Paved walking paths wind through the neighborhood, past a fitness center, clubhouse and swimming pool, as well as a collection of one-, two- and three-bedroom homes that are consistently tidy, but still boast their own personalities—everything residents could want from a single-family neighborhood, but without the responsibility to maintain regular upkeep or pay annual property taxes. In addition, single-family rentals often offer the intangible: a sense of community among neighbors, sometimes an unexpected perk for residents who may have chosen a single-family rental as a stop gap between homes or living situations.  

“I’ve seen people come here after taking advantage of the hot market and selling their homes with the intention to build or buy a new house,” said Colleen Sweet, property manager at The Havenly Fountain Hills. “But they end up staying because they love it so much.”  

It doesn’t surprise Sweet—often called the “Mayor of Havenly”—who has mastered what you might call the art of neighboring, by fostering that sense of community and small-town feeling with regular activities for residents. “Wellness Wednesdays,” movie nights at the pool and cookoff contests are regular events on the Havenly calendar. For Claudia and Kelly Finney, Saturday night card club is a must—and a far cry from one bitterly cold day about seven years ago, when the couple looked at the snow and freezing rain collecting outside of their home in West Chester, Ohio, and asked each other, “Why do we live here?” 

It’s not that the leafy suburb of Cincinnati hadn’t been good to them; it had been the ideal place to settle down and raise their two children, a daughter, now in New York, and a son in Arizona. Cincinnati had been their home for decades, and they planted deep roots, building a 5,200-square-foot custom home that overlooked the third hole at the Wetherington Golf and Country Club, where Kelly was the head golf pro. They had always envisioned their empty nester, downsizing stage of life to be a slightly reduced version of what they already had: a smaller home, still in Cincinnati. But with both of their kids living so far from Ohio, they decided to get closer to at least one of them—and since Arizona has “better weather than New York,” they packed up, leased their West Chester house and moved to Scottsdale for a test run at life in the Valley of the Sun. 

“We had to see if we loved Arizona first,” said Claudia, who wasn’t entirely convinced that she’d love the Arizona heat all year long.  

As it turned out, Arizona—and its heat—was a perfect fit for the Finneys, who leased a house for six years until they decided that they wanted to make the move permanent. They discovered and committed to a home at The Havenly Fountain Hills before the houses were even built.  

"We've see it all come together from the ground up," said Claudia. "It feels like we built the place ourselves."  

In a post-pandemic real estate landscape with continually rising interest rates, spiraling inflation and an ever-growing housing shortage, the increase of single-family rentals isn’t surprising—and those demand-generating conditions will continue to have the attention of the real estate investment community. But the single-family rental has become more than a viable housing option. It’s a beacon of suburban space, comfort and ease, especially for those who now have the flexibility to work from anywhere, or for people seeking to buy a home—but can’t—due to an undersupplied housing market or because high mortgage interest rates have priced them out of the type of home they want.  

In some cases, single-family rentals are simply the next right step in life. Two years ago, Amy Schmidt packed up and sold her Rutherford, New Jersey home and moved in, temporarily, with her daughter in Scottsdale. A self-described “Jersey girl,” Schmidt had retired after 33 years of employment with a major pharmaceutical company, and she was ready for something new and different. A master gardener, Schmidt fell in love with the natural beauty and walkability of Fountain Hills—and though she wanted to live in a house, she didn’t want to own one anymore. When she settled into her Havenly home a few months ago, she set out to walk, hike and explore the natural beauty of Arizona.  

“The nature is one of the reasons I moved out here,” she said. “Now, I just have to figure out how to grow a garden in the desert.”  

As for the Finneys and their two pups, they’re not leaving The Havenly anytime soon. “Why would we leave?” said Claudia. “We have everything we need here, and it sure is a heck of a view.” 

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