Survey Finds Nearly Half of Rental Units are in Properties with Four or Fewer Units
Of the 49.5 million rental housing units in the U.S., nearly 46 percent are located in rental properties of one-to-four units, according to the latest Rental Housing Finance Survey (RHFS) data released today by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau. For these small rental properties, 70 percent (15.9 million) are owned by individual investors, and more than one-third (8.1 million) have a mortgage or similar debt.
“The Rental Housing Finance Survey provides insight on the financial, managerial, and physical characteristics of rental properties nationwide,” said Solomon Greene, HUD’s Principal Deputy Assistant Secretary for Policy Development and Research. “Given that the survey was in the field during 2021, it will help the Administration to better understand how rental property owners responded to the COVID-19 pandemic.”
The Rental Housing Finance Survey is funded by HUD and is collected every three years by the Census Bureau. The RHFS is the most comprehensive survey of rental housing properties in the United States, covering topics such as property configuration, ownership and management, rental income and expenses, financing, and capital improvements and expenses. Today’s release includes summary tables (www.census.gov/data-tools/demo/rhfs/#/) for the nation. Public Use File (PUF) microdata will be released in mid-December.
Below are highlights from the national level findings among the 19.3 million rental properties, which contain 49.5 million rental units.
Rental Property Configuration
- About 86 percent of all rental properties contain only one rental unit.
- About one-third of all rental units are in properties with one rental unit and another one-third of rental units are in properties with 150 or more rental units.
Ownership and Management
- About 70 percent of rental properties, representing 38 percent of all rental units, are owned by individual investors and 15 percent of rental properties with 40 percent of units are owned by limited liability corporations or partnerships. For properties with 150 or more units, 67 percent are owned by limited liability corporations or partnerships.
- About 22 percent of small rental properties (1-4 units) are managed professionally while 84 percent of properties with 150 or more units are managed professionally.
Rental Income and Expenses
- The median monthly rental receipt per rental unit is $1000 compared with $750 in the 2018 RHFS.
- The median monthly operating expense (not including debt service) is $380 per rental unit.
Property Purchase, Value, and Financing
- The median estimated market value per rental unit is $175,000.
- The median purchase price per rental unit is $99,000 (not adjusted for inflation).
- About 41 percent of all rental properties have a mortgage or similar debt, compared with 35 percent of all rental properties that had a mortgage or similar debt in the 2018 RHFS. For properties with a mortgage, the median debt per rental unit is $180,000 at mortgage origination (not adjusted for inflation), compared with $119,200 in the 2018 RHFS.
Capital Expenses and Improvements
- About 76 percent of property owners reported making some type of capital improvement to their rental property in 2020.
- Owners annually spend a median of $840 per rental unit on capital improvements.
* All differences in this release are statistically significant at the 90% confidence level.