Single-borrower, single-family rental (SFR) securitization deals have seen a slight positive increase in rents in June compared with May, despite a slight increase in vacancies during the same period, according to recent findings from Morningstar | DBRS.
Among single-borrower SFR, mortgage-backed securities (MBS), that DBRS rated, the blended rent change was 8.8% in June, an increase from 8.6% in May. The Tampa metro area had the highest blended rent growth rate, of 6.8%, and the Atlanta metro area followed, with 5.4%.
The average retention rate for expiring leases among these properties was 86.0% in May, the period for which the latest data is available. It had dropped from 88.0% in April, according to the "Single-Family Rental Research" for August 2022. DBRS vice president Rohit Jadhav, a DBRS vice president, led the team that researched and authored the report.
Also, vacancy rates in June were 4.6%, up slightly from 4.2% in May, according to the analysts.
The update painted a mixed picture of the single-borrower, single-family rental (SFR) mortgage-backed securities (MBS) sector, as well as some information about the progress of multi-borrower, SFR trusts. The subsector makes frequent appearances among residential mortgage-backed securities (MBS), which totaled about $90.5 billion in transactions by August 25, according to the Asset Securitization Report database.
DBRS' RentRange rent change for three-bedroom properties was 6.1% in June, an increase from 5.4% in May, while rents for four-bedroom properties increased to 4.9%, compared with 4.3% in May.
As for multi-borrower SFRs, DBRA noted that realized losses as a percentage of original balances was less than 1.0% on loans that were in foreclosure or in special servicing, according to DBRS.
The total number of multi-borrower loans was 683 in July, down from 688 in June. The number of loans 30 to 59 days delinquent was 10, an increase from six, according to DBRS. Just eight loans were in foreclosure in July, unchanged from June.
