This article originally appeared in the May 2025 edition of MortgagePoint magazine, online now.
David Howard is CEO of the National Rental Home Council, a nonprofit organization representing the interests of the single-family rental home industry. In this capacity, Howard is responsible for managing all aspects of NRHC’s operating priorities and directing the organization’s legislative and public policy objectives.
Before joining NRHC, Howard served as Chief Development Officer of the Home Builders Institute (HBI), the workforce affiliate of the National Association of Home Builders (NAHB), where he was responsible for the organization’s overall fundraising, business development, constituent outreach operations, and government affairs activities. In this capacity, he also oversaw the strategic management and implementation of all philanthropic and corporate fundraising and development programs.
Howard has also served in executive roles at the Urban Land Institute (ULI), an international research and policy organization supporting sustainable urban development and responsible land use practice, and the National Association of Real Estate Investment Trusts (Nareit), the trade association representing the REIT and publicly traded real estate industry.
Howard spoke with MortgagePoint about the chronic housing shortage, the rise of build-to-rent communities, and how institutional investors are innovating in the single-family rental space.
Can you tell me about what the National Rental Home Council does?
Howard: The National Rental Home Council is a D.C.-based trade association that represents the single-family rental housing industry. Our members include owners, operators, and builders of single-family rental homes and single-family rental home communities.
We do a lot of advocacy work, policy work, and lobbying, both here in D.C. and in state capitals around the country. We exist to develop and share best practices throughout the membership and the industry.
What are some of the key trends shaping institutional investments and single-family rental?
Howard: The biggest issue facing housing today, writ large, and single-family rental housing within that space, is supply. There just isn’t enough housing because of a lack of construction that has been accumulating over the past five to 10 years. We find ourselves in a place now where there just isn’t enough housing—multifamily, owner-occupied single-family housing, and in our case, single-family rental housing. When people initially talk about housing supply, they do so in the context of homes available for purchase; there’s not enough housing out there for people to buy. Affordability is a related issue, but for those of us who live in the single-family rental housing world, the lack of supply is as much of a problem, if not more of a problem, than it is in the owner-occupied market.
People need a place to live. Household formation doesn’t stop based on what the broader trends in the economy are doing. It might slow down, it might accelerate, but there are certain things that you really can’t control in this world, and needing a place to live is one of them. We’ve had a chronic under-supply of homebuilding for several years, and it’s starting to catch up with us. That’s the big issue that’s impacting the world of single-family rental housing, and housing at a broader level as well. There are some things that we are doing within the industry to try to address that.
We look at single-family rental housing as a part of the solution to ails the broader housing market. We’re providing housing that is more affordable for families in locations where people want to be because those homes might be in proximity to places of employment or transportation quarters. Often it comes down to things like where people want to have their kids in school, they want to be in certain neighborhoods, they want to be in certain communities. And given where affordability is today, oftentimes it’s in the better interest of families and individuals to rent than buy.
One of the things that we’re doing to try to address this lack of supply is build-to-rent. Building homes to rent has been around forever, but what’s new in this space is the building of entire communities for rent. You’ll have a home builder who will build 150 homes with a little club and walking paths and all of that, and all of the homes will be for rent instead of for sale. That’s a trend that’s starting to catch on, particularly in places like the Southeast, Southwest, and Texas, as a way of trying to address the fact that there just isn’t enough housing out there.
How has the role of institutional investors in the housing market evolved over the past five years, and where do you see it heading next?
Howard: Institutional investors play an important role in the single-family rental housing industry, and it’s a role that is becoming more important. As we look to address some of these structural challenges confronting the housing markets, what institutions do very well is provide capital to make sure that housing is available for those who need it the most.
Institutions are committed to providing long-term quality, dependable, single-family rental housing. They’re committed to investing in their homes, they’re committed to working with residents, to caring for their residents. They bring a lot of innovation to the business of single-family rental housing. The business of single-family rental housing has also been around forever, but it’s always existed in this gray space between owner-occupied housing and apartment living. What institutions have done is they’ve helped to define what has traditionally been a middle ground in the housing market, this world of single-family rentals that has been dominated by small, local, mom-and-pop owners and investors. What institutions have done is, through their scale, through their access to capital, through their ability to direct capital to certain markets, they’ve brought a lot of innovation and new forms of technology to the business of managing single-family rental homes.
For decades, people rented homes the same way that they did 50 years ago. The things that institutions bring to the market are new ways of doing business and new ways of managing portfolios of single-family rental homes. That’s an important part of the puzzle that a lot of people don’t see. But the reality is, you miss a lot of what’s happening on the ground, what’s happening in the neighborhoods, what’s happening in the communities. We know, for example, that our members who tend to be larger companies in the industry invest $30,000 on average in every home that they purchase—in new windows and landscaping and ways to fix up the property. The average homeowner, for comparison, invests about $9,000 in the homes that they purchase. All of this goes to improve the properties, improve the resident experience, and raise property values throughout the neighborhood. That’s something the institutions don’t get enough credit for, to be honest.
How do you respond to criticisms sometimes leveled at institutional investors, such as that they’re competing with homebuyers for already limited affordable housing stock?
Howard: It’s a good question. To some degree, this has been one of those issues that have gotten mixed up in a lot of different, seemingly unrelated issues that have impacted the economy and the world of policy over the past few years, and COVID-19, frankly, had a lot to do with that. At the beginning of COVID-19, there was a lot of focus on big companies, whether they were in the housing market, whether it was Big Tech, whether it was Big Oil, whether it was Big This or Big That. All of a sudden, big was bad.
Institutions in the rental housing space, both multifamily and single-family, got wrapped up in that. People like to have a villain. And there’s always been this us-versus-them mentality when it comes to renters and landlords and property owners. And look, some landlords out there are not doing the right thing.
We do a lot with our members to ensure that they’re focused on the resident experience, property management, and things like that in the neighborhoods and communities where their homes are located. But there are some out there who are not part of NRHC or organizations like NRHC, and it’s hard to police and monitor.
When we have an opportunity, whether we’re talking with the media or policymakers, to say, “The housing market needs help, and we want to be a part of that solution.” Let’s get past some of these narratives. Institutions are not buying every home in every neighborhood across the country. They’re not competing with homebuyers, they’re not hurting homeownership. What they are doing is providing quality, well-located, affordably priced housing where people want to live.
How have rising interest rates and tighter credit conditions impacted the business models of NRHC members?
Howard: Our members are not immune to what’s happening in the broader economy. When it’s more expensive for you or me to purchase a home because mortgage rates are close to 7%, it’s also more expensive for institutions to purchase homes. When the cost of capital is higher, you see less activity.
Over the past couple of years, you’ve seen a fairly dramatic decrease in the number of homes that our members are purchasing and that the larger companies in the industry are purchasing. At the same time, you’ve seen the drop-off also in the number of homes that smaller investors are purchasing. That’s directly attributable to the cost of capital. It’s just more expensive to purchase.
At the same time, you’ve also seen more of a focus on the building of new homes because of how the financing dynamics work out. It can be less expensive to build homes from scratch than it is to go out and purchase a home.
With the ongoing evolution of build-to-rent communities, how do you see that segment complementing or disrupting traditional homeownership models?
Howard: Build-to-rent is a win-win for owners of single-family rental homes, builders of single-family rental homes, and also residents who choose to live in newly constructed single-family rental home communities. As a resident, you’re living in a brand-new home with all the bells and whistles that a new home offers. Everything is clean and modern and everything works.
You get all the amenities, but you also get the convenience and flexibility that renting offers. You don’t have to come up with a down payment. Coming up with a $50, $60, $70,000 down payment is a major impediment. One of the primary reasons why there hasn’t been more homebuying is that people can’t come up with that down payment.
Renting a single-family home is about $1,000 less on average per month than paying a mortgage on a single-family home. We know that people tend to stay in build-to-rent homes longer than they do existing single-family rental homes.
What legislative or regulatory developments is the NRHC most focused on right now, and how might these impact the broader real estate investment landscape?
Howard: It comes down to supply. We work closely with members of Congress and the administration on ways that we can unlock more investment geared toward increasing the housing supply. For example, one of the areas we’re involved with is this idea of opening federal lands to housing development, which we think is something that will work very well in some locations.
We also do a lot of work on low-income housing and tax credit issues, encouraging builders to develop properties in certain locations that have been identified by local policymakers as those that where they want to see housing development. That’s something that also extends to the state level. We’re very involved in those states where our members are more active—places like Georgia, Texas, Tennessee, and Florida, which are places where you tend to see more in-migration.
People talk about institutional investors being in Charlotte, Nashville, and Atlanta, and places like that, and my response to that is, well, that’s where people are moving. We know there’s a direct correlation between in-migration and population growth and the demand for rental housing, for both multifamily and single-family. Because of that, we do a lot of work in [places like] Georgia at the state, county, and municipal levels on various issues related to rental housing.
How are investors being impacted by spiking property insurance rates, especially in places heavily impacted by climate-related natural disasters such as Florida and California?
Howard: That’s a really important question. When you look at markets like Florida, which happens to be a very important market for us and our members, property insurance has become a real problem. Also, now we’re dealing with things like tariffs and a lack of immigration. I don’t say this as a political thing, but when you cut off the flow of people coming into this country who traditionally have gravitated toward fields like construction and home-building, that’s going to have an impact. So, there could be fewer people available to build homes.
Lumber and glass are more expensive to import, so that’s going to have an impact on the cost of a new home, or an existing home when it comes to improvements and renovations. The institutional owner has a little bit of an advantage, in that if you own 5,000 homes in a market, you probably have enough scale to be able to obtain goods and services at a lower price than somebody who might own one or two homes.
