This article originally appeared in the April 2025 edition of MortgagePoint magazine, online now.
The single-family rental sector has been a critical part of the American housing ecosystem for decades. While the notion of owning a home is a core tenet of the so-called “American Dream”—even without the iconic white picket fence—the fact remains that many Americans are not in an economic position to buy a home or secure a mortgage even in the best of conditions, much less in a time when inflation is still cooling, mortgage rates remain relatively elevated, and insufficient inventories continue to keep home prices high.
Single-family rental (SFR) offers an alternative, a middle-ground compromise between homeownership and multifamily renting that provides the conveniences and perks of a single-family home while removing some of the economic costs and barriers to entry.
That has long positioned the single-family rental segment as a place ripe with opportunities for both investors and companies servicing the sector.
In recent years, factors such as high demand and limited supply have helped single-family rents often stay ahead of the multifamily equivalents. While recent months have seen those trends begin to shift as home construction has ramped up and multifamily development has slowed down, demand for SFR homes is expected to remain strong, with Zillow putting the typical asking rent for single-family homes at $2,189 in a March 2025 Rental Market Report.
Year-over-year, according to that same report, rents have increased in 47 of the 50 largest metro areas, and “the median household now dedicates 29.3% of its income to secure a typical rental—up from 26.9% before the pandemic.”
Stakeholders ranging from large institutions to mom-and-pop investors continue to make SFR a priority, and as long as that remains the case, there will be a need for service providers to perform tasks ranging from due diligence inspections to property scopes and renewal inspections. Safeguard Properties, a staple of the property preservation marketplace for more than three decades, has recently expanded its offerings into the SFR sector.
Leading the vanguard of this initiative for Safeguard is John Elsey, Safeguard’s VP of Single-Family Rental. John Elsey graduated from Purdue University with a Bachelor of Science in construction technology. He spent over a decade in the new home industry, where he became a Graduate Master Builder with the NAHB. He entered the SFR industry in 2014 with American Homes 4 Rent, where he was the VP of Home Services, encompassing both occupied maintenance and turn management nationally. He most recently served as the VP of Turns for Mynd Inc. and Roofstock before transitioning to Safeguard Properties.
“The demand for SFR properties, although already strong, increased even more when interest rates began to drastically increase in mid-2022,” Elsey explains. “The demand for housing has not abated, but the macro-environment has placed homeownership out of reach for much of the general public. The demand for housing has pushed rental home prices to historic levels.”
A Shifting Landscape Breeds Shifting Priorities
Factors such as higher interest rates, inflation, and supply challenges have combined to help cool the overall housing market over the past year, with many existing homeowners remaining “locked in” by low rates acquired during the pandemic and its aftermath.
“The balance of homeownership vs. renting has shifted greatly since 2022,” says Elsey, with many American families watching the prospect of homeownership slip further and further out of reach. “Many current owners are holding off selling their property because they most likely could not increase their living conditions for the same reason,” he continues. “There is significant demand growing in anticipation of lower rates. This, of course, has led to higher rental costs due to demand and an increased focus on turning properties quickly to reduce opportunity cost loss.”
Elsey further notes that the institutional acquisition of new SFR properties over the previous few years has slowed accordingly, which marked a significant shift from general SFR trends since the global financial crisis (GFC).
Elsey explains, “Institutional investors truly drove the creation of the SFR industry post-GFC. Prior to that, most rental homes were owned by small operators with one to five properties. By the end of 2022, institutional owners amassed approximately 574K homes.”
While a significant number, Elsey points out that 574,000 represents less than 4% of all single-family rental homes in America. “It is clear that institutional ownership will continue to increase, and specifically when interest rates begin to meaningfully decrease,” he adds.
With institutional investors and mom-and-pops both trying to wait out interest rates, Elsey explains that the industry has in the meantime pivoted to focus more on operational costs such as tenant turn and general maintenance. “Many companies focusing on the initial rehab of newly acquired properties have significantly reduced staff, and several have merged to take advantage of technology and capital,” says Elsey. He adds that many smaller investors may be currently relying on cash purchases to work around the interest rate challenges, but that this “may cause a property to cash flow negatively.”
Staking a Claim in SFR
Founded by industry icon the late Robert Klein in 1990, Safeguard has, over the ensuing 30 years, grown into one of the largest and most recognizable mortgage field services companies in the nation. Their service offerings run the gamut from property inspections and data collection to FHA conveyance and REO services.
“Safeguard recognized the similarities between property preservation and the SFR industry several years ago,” Elsey tells MortgagePoint. “With some of the consolidation happening within the industry, and specifically in the management of the physical asset, it became apparent that Safeguard had a lot to offer. Initial planning began in early 2024 and launched in earnest in Q4 of last year.”
Safeguard’s SFR segment leverages overlap between the needs of SFR investors and traditional property preservation clients, filling a need by offering services Safeguard is already well-equipped to manage.
“The services provided on the ground are similar if not identical,” says Elsey, “and the ability to capitalize on the volume of both industries allows Safeguard to provide the least costly solution for both.”
For its SFR clients, Safeguard offers full-service tenant turn capabilities, including scoping vacant properties and completing approved line items in a timely and cost-efficient manner, and that vendor network is critical to Safeguard’s ability to respond swiftly and nimbly across many U.S. regions. Safeguard’s SFR offerings include initial rehab, disposition, and disaster recovery services, in addition to basic recurring services such as lawn mowing or snow removal.
One huge advantage Safeguard brings to the table is its nationwide vendor network, built up over the company’s more than three decades serving the property preservation space. By taking advantage of this network of thousands of vendors across the country, Elsey says that Safeguard can often respond as soon as the same business day to their client’s requests.
Safeguard’s SFR offerings are specifically designed to allow the company to act as a Business Partner Organization with its clients. Elsey explains that “having roots in property management, we are acutely aware of the cost control needed to make rental properties a viable investment vehicle. This enables us to act as a fiduciary for our clients and provide a scope that mirrors their investment philosophy, reducing overall costs to operate a rental property over the lifetime of ownership and increasing their total ROI long term. Once the client has reviewed and approved the budget, we can perform work quickly and efficiently, without undue increases in the cost of service.”
Elsey also reveals that, as part of its evolving commitment to better serving clients, Safeguard will also soon begin offering “ala carte” services for all its services.
“The flexibility to request a selected number or all our services means the client can pick and choose to fulfill their needs on either a temporary or permanent basis,” Elsey says. “Our ability to both scope properties and perform the needed repairs upon approval will help customers of all portfolio sizes and those who don’t have a physical presence in a market.”
Safeguard’s footprint for these SFR services is also in the process of growing. The company has historically operated primarily in the Midwest and has recently expanded further into the South. Elsey says further expansion plans in the coming months and years will be “based on the needs of the industry.”
SFR investors, whether institutional or individual, face several critical operation costs, including controlling construction and maintenance costs when a property transitions between one tenant and the next. These costs can include ensuring timely, cost-effective repairs and also working to minimize the vacancy period between tenants.
“Building partnerships with competent service providers is the most effective way to manage time and cost,” Elsey says. “Repetition is the surest path to synergies, and utilizing a partner who is strategically aligned with their needs provides dividends versus trying to manage hundreds of vendors and suppliers to perform the same function.”
Elsey explains that Safeguard’s nationwide vendor network and vertical integration can help streamline these processes and reduce those turn times, thus driving up investors’ ROI.
Beyond the benefits of Safeguard’s nationwide vendor network, the company also provides a technological edge via products such as SafeView. Safeguard was an early adopter of technology to manage multiple players in multiple markets. After trials of out-of-the-box technology, it was determined that a home-grown proprietary system was necessary to serve clients’ needs.
Elsey said that SafeView, “allows for the almost instantaneous importation of work and end-to-end management of vendors and compliance, and it includes built-in quality control mechanisms to ensure completion of jobs in a timely and cost-effective manner.”
“Within the SFR realm, technology allows the operator and the service provider to quickly assign, service, and invoice for work that would otherwise require laborious phone calls, texts, and emails,” Elsey continues. “Safeguard’s proprietary, tech-forward systems allow for almost instantaneous acceptance and assignment of a client’s work order to the market-level performers for timely completion.”
In addition, Safeguard is able to leverage pre-negotiated labor rates with its vendors, thus reducing turn times by establishing a fair and repeatable price in advance.
What’s Ahead for SFR?
The first few months of 2025 have been turbulent ones, driven by massive changes in Washington, D.C., driven by the returning President Trump, who has prioritized hugely impactful shifts such as a widespread crackdown on immigration and deportation enforcement, downsizing of government agencies, and tariffs levied against numerous other countries, the full economic weight of which remains to be seen. While the dust still needs to settle before it will be apparent what all this will mean long-term for both the housing market and the SFR space, there’s no question that these factors will shape the landscape for the remainder of the year, and possibly beyond.
Elsey notes that Trump’s tariffs and immigration policies “could lengthen tenant turn times and substantially increase costs of capital items like appliances and mechanical equipment produced outside the U.S. Labor rates may increase as well due to a reduction in the number of workers available to perform the work. These costs would, of course, be passed along to the consumer in the form of higher rental rates.”
Elsey also notes that several bills in Congress are designed to “somewhat throttle the SFR industry.” Elsey explains that “they cover everything from limiting the number of homes an institution may own to outright bans on institutional ownership of single-family residential properties.”
Elsey says he doesn’t expect these bills to gain much traction, however, “as they do nothing to increase the number of available homes and could actually make the supply of available homes worse than it is now.”
He adds that the creation of Build-to-Rent communities—entire neighborhoods constructed as single-family homes strictly for rent—provides a lower-cost alternative for families to enjoy the benefits of a new home without the hurdle of current high interest rates.
Looking further down the road, Elsey speculates that issues such as tariffs, inflation, and ongoing high interest rates “could lead to stagnant portfolio growth, reduced rent rolls, and higher costs for tenant turns and general maintenance.” He adds, “I don’t foresee any of these being overly impactful, but they are risks just the same.”
In such an uncertain time, SFR investors will rely even more on the stability and responsiveness of partners such as Safeguard.
“The institutional SFR industry has become a major provider of the benefits of homeownership without the burden of costly maintenance,” Elsey says. “It also provides flexibility of mobility for work or other life requirements without the undue stress of selling a home to enable it. Safeguard provides the services needed to maintain the earning potential of a portfolio of properties with the same swiftness and professionalism it is renowned for in the preservation industry.”
