Richmond, Raleigh Rank As The Friendliest Cities For Single-family Renters

Single-family renter households have grown by 31% over the past two decades, outpacing the 21% increase in owner-occupied households. Alongside that growth, several metropolitan areas stand out as the best locations for single-family renters.

These findings come from a recent analysis by real estate listing website Point2Homes. The study examined the 75 largest U.S. metros to determine the best cities for single-family renters. Point2Homes used 25 indicators across economics, housing affordability and quality of life.

According to the study, a growing number of renters are turning to single-family homes due to common market pressure points such as higher home prices and mortgage rates, as well as dwindling inventory. Point2Homes also said that some metros areas are better at accommodating single-family renter demand than others.

“The good news? Some metros manage to offer a mix of opportunity and quality of life, thereby proving that ‘location, location, location’ matters just as much for renters seeking comfort and stability without the burden of ownership,” Point2Homes explained in the report.

Six of the top 10 areas for single-family renters are on the East Coast, according to Point2Homes:

• Richmond, Virginia
• Raleigh, North Carolina
• Salt Lake City, Utah
• Boise, Idaho
• Honolulu, Hawaii
• Allentown, Pennsylvania
• Pittsburgh, Pennsylvania
• Virginia Beach, Virginia
• Hartford, Connecticut
• Omaha, Nebraska

Richmond earned the top spot with its strong job growth of 3.4% in the past year. According to the study, the metro area has eight Fortune 500 companies. Job availability, coupled with a wallet-friendly single-family rental market, was enough to establish Richmond as a prime spot for prospective tenants. The average annual income for households in the area is $82,862.

Raleigh occupied the No. 2 on the ranking. Alongside a healthy job market, Point2Homes highlighted the city’s increasing build-to-rent inventory as a key factor behind its large share of residents who live in single-family rental homes.

According to the report, Raleigh also “plans to expand its build-to-rent inventory tenfold to meet rising rental demand.” The average annual income in the area is $92,865.

Salt Lake City rounded out the top three metro areas in the study, with 56% of its single-family renter households able to comfortably handle housing costs. The city also posted a low unemployment rate of 3.1% and a job growth rate of 1.9%.

Point2Homes highlighted the top metros for economic health and housing affordability, which were led by Omaha and St. Louis. It also ranked the top metros for community and life quality, led by cities in California and New England.

The thesis of the study points to a change in homebuyer demands going into the spring. The build-to-rent market is growing, and the long-term trend of choosing a single-family rental may be here to stay.

Alongside that, U.S. single-family rents in January posted its slowest annualized increase in 14 years, according to a report by CoreLogic. This could give households greater opportunity to snag their desired location without worrying about home prices or mortgage rates.