As the US continues to face a shortage of affordable housing, rehabilitating the country’s aging housing stock is more important than ever. According to the American Housing Survey, more than 330,000 occupied single-family rental (SFR) homes in the US are severely inadequate and in need of repair. Of the 14 million vacant single-family homes, the National Community Stabilization Trust estimates that 2.2 million could be rehabilitated.

But smaller landlords, mission-driven housing providers, and individual homeowners often don’t have the capability or resources to preserve affordable housing through rehabilitation. Partnerships with large SFR investors could enhance their scale and efficiency.

In this article, we use data from Progress Residential—a single-family property manager for homes owned by Pretium managed funds—to explore how SFR investors have developed extensive renovation and property management capabilities over the past 15 years. These investors’ financing capacities and network of suppliers and contractors could offer nonprofits and mission-driven housing organizations cost efficiencies and expand their capacity to rehabilitate and offer high-quality affordable homes. 

In response to changing market conditions, SFR investors have built out property management and renovation infrastructure

Institutional investors first started buying single-family homes in the aftermath of the Great Recession, primarily purchasing foreclosed homes from banks and on courthouse steps. When this stock of homes largely evaporated, these investors turned to multiple listing services (MLSs).

In the past five years, both borrowing costs and home prices have increased faster than rents, reducing SFR investors’ returns. As a result, many institutional investors began investing in build-to-rent homes, which offer greater control over costs and product standardization.

Today, about 16 percent of all single-family homes are rentals. Institutional investors—those holding 350 homes or more—own about 5 percent of SFRs.

Yet even the build-to-rent segment has slowed since 2025 as rent growth moderated and construction and land costs rose. At the same time, these investors are increasingly selling homes when disposition values exceed the net present value of holding the asset, resulting in limited net portfolio growth in recent years. If current elevated interest rates and sluggish rents persist, dispositions could increase.

As part of the rental business, institutional investors have over time invested heavily in building property management and renovation infrastructure. Compared with individual homeowners, institutional investors are better positioned to determine which improvements are economical and are better positioned to complete renovations at a lower cost by contracting labor and materials at scale. Moreover, most homeowners finance repairs with cash, and first-time homebuyers in particular often lack the liquidity to undertake substantial renovations.

At first, institutional investors outsourced renovation and maintenance but told us that they found this approach slow, compromising responsiveness to tenants’ requests. Many subsequently internalized these functions, building integrated property management platforms.

Case study: Progress Residential’s rehab and property management services

Using Progress Residential—a property manager of roughly 82,000 single-family homes—as a case study, we quantify the scope and cost of rehab and property management services.

Progress Residential’s property management services fall into four broad categories:

• initial rehabilitation following acquisition,
• turnover maintenance between tenants (i.e., “turns”),
• ongoing maintenance during occupancy, and
• long-term capital expenditures.

Between 2021 and 2023, Pretium acquired around 56,000 homes, including 30,000 homes from MLSs.

Institutional investors often seek out homes on MLSs that require repair, because they have the operational scale and construction expertise to renovate them efficiently. Before bidding, property managers assess required repairs and incorporate those costs into acquisition pricing. Once acquired, rehabilitation typically includes ensuring core systems—such as plumbing, electrical, and HVAC (heating, ventilation, and air conditioning)—function properly, updating appliances, and repairing interior finishes and structural elements.

From 2021 to 2023, approximately 43,000 homes were renovated. This included all 30,000 homes acquired through the MLS, as well as an additional 13,000 properties purchased before 2021, vacant homes from portfolio acquisitions, and built-to-rent properties. The rehabilitation costs for more than two-thirds of the properties Pretium renovated ranged from $20,000 to $40,000 per property. For all homes renovated, the average rehabilitation cost was about $32,000.

These figures align with industry disclosures. AMH (previously American Homes 4 Rent), an integrated owner, operator, and developer of SFR homes, reported $20,000 to $40,000 preparation costs in its 2024 Form 10-K. Another single-family home leasing and management company, Invitation Homes, reported roughly $35,000 in rehabilitation costs per property in its 2021 Form 10-K.

When a tenant moves out, SFR investors must prepare a home for the next resident, including painting, carpet cleaning, making necessary repairs, and replacing old appliances. From 2021 to 2023, Progress Residential completed around 54,000 turns, with an average cost of $4,200 per home.