Federal Reserve Bank of San Francisco

The Emerging Economic Geography of Single-Family Rental Securitization

January 21, 2016

This working paper utilizes data culled from presale reports from the first wave of rental-backed securities to analyze and describe the emerging trend of single-family home rental (SFR) securitization. Authors provide a basic overview of the market, showing the number and market value of single-family homes involved in these new financial products. Analyzing the geography of the first 15 offerings made between November 2013 and January 2015, authors then produce one of the first maps of the phenomenon, showing a geography heavily weighted towards five states (California, Florida, Texas, Georgia and Arizona) and two Federal Reserve Districts (6 & 12). While the geography of rental securitization is not independent of the post-crisis geography of foreclosure, neither does it map perfectly. Moreover, this geography has evolved over time, with more recent securitizations expanding out from established epicenters of investor activity. Finally, authors examine data on the accessibility of SFR securitized homes to Section 8 tenants, an analysis which suggests a mixed and still very cloudy picture when it comes to the impact on renters. The fundamental conclusion for the policy and community development community is that we simply do not have enough information to draw conclusions as to the future, nature or impact of this growing phenomenon. More transparency and research is needed.

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