Investors, Partners, and Friends,

With homeownership increasingly out of reach and housing supply structurally constrained, Build-to-Rent (BTR) is becoming one of the most important investment themes in U.S. residential real estate.

In this month’s Rockview Review, we break down the BTR opportunity, including:

• What’s driving long-term renter demand
• How BTR compares to traditional multifamily formats
• Where Rockview Capital is focused geographically
• And why we believe now is an excellent entry point for long-term investors

We hope you find this edition valuable.

What Is Build-to-Rent?

Build-to-Rent (BTR) refers to purpose-built communities of single-family homes or townhomes designed for long-term rental rather than individual sale. These communities are:

• Detached or attached homes with no units stacked above or below
• Managed by property management firms
• Designed with community-wide amenities like yards, pools, and fitness centers

BTR combines the livability and privacy of for-sale housing with the efficiency and amenities of institutional multifamily. Here's a quick comparison chart between BTR and typical multifamily:

Why It Exists: The Affordability Crisis and Demand Shift

BTR is growing because the traditional housing system (both for-sale and for-rent) is failing to meet the needs of a large and growing segment of U.S. households. It solves for three converging pressures: affordability constraints, shifting demographics, and evolving lifestyle preferences.

1. Homeownership Affordability Has Collapsed

Owning a home is no longer realistic for many American households:

• The median monthly mortgage payment reached $2,942 as of Q4 2024, compared to $1,828 in rent, a 61% ownership premium, as the chart below outlines:

• Home prices have not meaningfully declined despite higher borrowing costs, locking out first-time buyers. Only 15% of homes for sale are affordable to median-income households—a decade low.
• The “Lock-In Effect” Pictured Below: More than 50% of outstanding residential mortgage loans have interest rates below 4.0%, keeping existing owners locked into their existing mortgages.

The result: more “renters by necessity” who are staying in the rental market longer, even as their space and quality-of-life expectations increase.

2. Demographics Are Delaying or Replacing Homeownership

Millennials (now in their 30s and 40s) are in prime family-forming years, but homeownership is no longer a guaranteed milestone:

• Millennial ownership rates lag Gen X and Boomers by 8–10 percentage points at the same age
• Student debt, inflation, and childcare costs are major headwinds
• Many millennials are starting families while still renting, but want something better than a two-bedroom apartment

At the same time:

• Gen Z is entering adulthood with lower ownership expectations and high housing costs
• Baby Boomers are downsizing into rentals but still want space, privacy, and outdoor access

These dynamics are creating sustained demand for home-style rental product, which only BTR delivers at scale.

3. Work and Lifestyle Preferences Have Evolved Post-COVID

The pandemic accelerated a shift in how and where Americans live and work:

• Remote and hybrid work has freed many from urban cores, driving migration to suburban and Sunbelt markets
• Renters now prioritize extra bedrooms, home offices, garages, and yards—features traditional apartments rarely offer

BTR is purpose-built to meet these preferences, offering spacious layouts, outdoor areas, and new-construction finishes in communities designed for long-term living.

Rockview Capital’s BTR Strategy: Where and Why

At Rockview Capital, we’re actively pursuing BTR acquisitions in Phoenix, Las Vegas, and Salt Lake City: three markets that possess phenomenal long-term growth drivers.

Phoenix, AZ

• Employers like TSMC and Intel continue to fuel population growth in areas like the West Valley and East Valley.
• Housing affordability continues to deteriorate, especially for first-time buyers, positioning BTR as the next-best option for families and working professionals.

Las Vegas, NV

• Las Vegas is rapidly diversifying beyond hospitality, with growth in sectors like healthcare, logistics, and tech.
• In-migration from California remains strong, leading home prices to climb significantly, and pushing many would-be buyers into renting.

Salt Lake City, UT

• Salt Lake City has one of the youngest populations in the country, with a 6.4% projected five-year population growth.
• It also ranks among the most undersupplied single-family housing markets, with BTR meeting strong demand for attainable suburban rentals.

Across all three markets, we’re leveraging our relationships with local brokers, developers, and operators to source off-market or early-phase opportunities, with a focus on well-located, well-built communities.

Risks And Considerations

While BTR investment is compelling, investors should understand the key risks that exist in this emerging asset class:

• Interest rate normalization: If mortgage rates decline meaningfully and homeownership becomes more accessible, some renter households may shift back to for-sale housing. This could soften demand in some price-sensitive BTR submarkets.
• Lack of long-term sales comparables: BTR is a relatively new asset class. Institutional-scale exits are still limited, making valuation discovery and exit underwriting less reliable than traditional multifamily.
• Operational complexity: Managing horizontal communities poses unique logistical challenges—landscaping, maintenance dispatch, leasing coordination—requiring more deliberate systems than vertically integrated apartments.

But Why Invest Today?

Many of these Sunbelt markets, including our target markets, are currently working through a wave of new housing supply, leading to negative trade-outs in some submarkets, high concessions, and occupancy rates dipping below historical norms. To some, this raises the question: why invest now?

At Rockview Capital, we believe this environment presents one of the most compelling entry points in recent memory. Here’s why:

• Assets are trading at discounts to today’s replacement cost from developers and investors who are unable to hold assets through this volatile capital markets environment, creating an exceptional buying opportunity for well-capitalized, long-term oriented firms like Rockview Capital.
• We're investing in long-run fundamentals. While short-term operations are weakened, population and job growth across our target markets remains strong and sustainable. Housing demand will normalize as new supply is absorbed, and construction activity slows due to capital constraints.
• Less competition from buyers. With many institutional groups sidelined or frozen by higher interest rates, today’s environment offers the chance to acquire high-quality real estate with less pricing pressure.

In our view, these dislocations create the best buying windows for long-term real estate investors.

Reach out to Rockview Capital to learn more about how we’re approaching BTR investments during this dislocation and where we see opportunity taking shape.