When Bruce McNeilage bought his first rental property in Nashville, TN, “I figured out I didn’t want to fix things,” he admits. “I wasn’t handy.” He realized that the easier way to own rentals was to buy a brand-new house.

Since then, McNeilage’s need for ease has turned out to be a business strategy. He has since bought—or built—more than 1,000 properties through Kinloch Partners, capitalizing on the rapidly expanding build-to-rent (BTR) market. Though most new homes in the US are still purchased as primary residences, over 321,000 homes have been built specifically as rentals since 2012 (more than three-quarters of those in the past five years), according to John Burns Research.

This real estate sector has attracted attention recently due to President Trump, who has been cracking down on large institutional investors buying up houses, but has indicated that there may be exemptions for certain groups, such as build-to-rent. Builders are also in talks with the White House about erecting 1 million “Trump Homes” that would start out as rentals and offer a path to ownership in three years. Trump’s support of build-to-rent boils down to the fact that builders expand the housing supply rather than competing with buyers for existing homes. According to Richard Ross, chief executive of build-to-rent developer Quinn Residences, “Build-to-rent is part of the solution to the US housing crisis.”

A new type of rental

About one-third of Americans rent their home. Although “rental” might conjure visions of high-rises packed with apartments, a growing number of today’s rentals are free-standing single-family homes, nestled in suburban communities with top-notch schools. Buying in these areas often requires deep pockets, but BTR communities make them accessible to renters for significantly less upfront cash—often 40% to 50% less, according to Ross.

Long before Trump’s potential loophole was announced, institutional investors like Blackstone, Invitation Homes, and Pretium Partners had already shifted more of their business toward build-to-rent communities because it made financial sense (new construction requires a lot less maintenance). A growing number of mom-and-pop investors have also hopped on the BTR bandwagon, shopping investor-friendly marketplaces like Lennar or Rent To Retirement.

“We’re huge believers in new construction because it limits capital expenditures and attracts quality tenants who stay longer,” says investor Zach Lemaster, who started as a typical landlord, got overwhelmed with repairs, and launched Rent To Retirement to offer more “turnkey investment” opportunities to investors. “All my friends were coming to me saying, ‘Hey, we want to invest, but we don’t want the headaches.’ That’s the problem we solve.”

Rentals have changed, but so have renters. “Twenty years ago, 100% of my tenants had to rent,” says McNeilage. “Now, a large portion of our business is people choosing to rent. Our average tenant makes $126,000 a year.” Part of this preference may be due to job mobility, or the simple fact that rentals are cheaper than owning and less of a headache. Like McNeilage himself, today’s renters increasingly share a simple philosophy: They don’t want to fix things.

The biggest discounts in 13 years: Redfin found that buyers scored a record number of homes below asking price last year, averaging 7.9% in savings—the most significant markdown since 2012. And the deals were even bigger steals for one particular type of home you’ve probably overlooked.

Trump’s latest plans for housing: He wants lower mortgages, but higher home prices. Here’s why experts are skeptical.

They’re baaack. Last fall, a record-high number of home sellers who couldn’t find a buyer yanked their properties off the market. But many of those delistings have since returned to market. Here’s where sellers are offering buyers a huge helping of humble pie.

The number of bedrooms you’ll regret getting: Although you think it’s ideal, one investor who’s leased thousands of apartments swears this configuration is the toughest to rent.

The “Super Bowl effect” on real estate: Zillow found that football championship cities enjoy a $4,000 home value bump. One winning city recorded robust gains of nearly $70,000; try to guess where.

“It came as a complete surprise.” WSJ readers voted for their house of the year. And if that whets your appetite for more, try their dream house generator.

Sleeping in your office might sound like a Severance-style nightmare, but Ben Chester turned it into an opportunity—by renting out his empty New York City apartment. Check out how this wild scheme led to a portfolio of eight rentals, including Billy Joel’s old digs in upstate New York.

Q: How did you begin investing in real estate in New York City, of all places? “I simply wanted to live here and have enough money not just to put everything toward rent. At the time, I had a job at a sleep clinic. I was like, ‘I could probably secretly live here, and nobody would stop me because they’d assume I’m working.’ So in 2012, I posted my room on Craigslist and was blown away by offers over asking. So I moved into my office for two years.”

Q: Did anyone find out? “There were a couple of close calls. One time, pest control came in and saw stacks of clothes under my desk. They told the CFO, who was like, ‘What’s going on? Are you a hoarder?’ He didn’t even consider the possibility that I was living there. I had a friend who was living in his office; he and I teamed up and got more apartments and rented them out. We eventually moved in together into a walk-in closet in one apartment.”

Q: Did landlords know you were subletting? “The first ones were under the radar. But by a certain point, because we were renting multiple units from the same landlords, we told them. They were like, ‘If you guarantee the rent, fine.’ We then scaled to 700 renters in around 300 units, but went through huge swings with massive demand in the summer and vacancies in the winter. The company went under. I had personally guaranteed the company credit card and ended up on the hook for $120,000.”

Q: Wow. So what next? “I found a one-bedroom apartment, got three roommates, house hacked to cover my expenses, and eventually had enough to buy a co-op. I bought co-ops in 2019, 2021, and 2023—each time living in them for two years, then renting them out. Over the span of five years, I bought eight properties, including Billy Joel’s lake house.”

Q: Tell me more. “I started shopping outside the city, and a house popped up in Highland Falls that needed updates for under $2 million, with an infinity pool and Hudson River views. I saw buried in the listing that it was originally JP Morgan’s summer home, and that Billy Joel rented the place. He wrote Turnstiles there, including ‘New York State of Mind’ literally on his way to the house. I turned it into a bed-and-breakfast called Cragston.”

Q: What’s your advice for investing in an expensive market like NYC? “I think it’s easy to look back and say that there’s a grand strategy. But I think what I did is just take it one step at a time and think, ‘Where am I willing to make sacrifices?’ Then you just take one slightly larger step and build a mini empire.”

This week, we’re heading to Des Moines, IA.

Average home price: $203,387 (up 1.1% YoY)
Homes that sell over list price: 19.2%
Homes that sell under list price: 62.3%
Average rent: $1,100

Lay of the land: Des Moines may be affordable, but high interest rates have made the market a tougher nut to crack. “The real estate investor market has been tough,” says Mitch Coluzzi of SoldFast Des Moines. “Many folks got used to lipstick remodels, where you paint and carpet for a profit. They’re not used to larger projects where you can add deep value through improvement. The difficulty is buying the project at a profitable gap because so many people overpay for marginal houses.”

His advice: Look for deals through estate sales. That’s how Coluzzi recently purchased a two-bedroom, one-bathroom home for $80,000. “The owner passed away, and it was in pretty rough condition and had not been maintained,” he recalls. After pouring $24,000 into renovations, he listed it for $164,900, which, he says, breaks down to monthly payments “around the same rate as rent for a similar unit,” making this a win-win for both buyer and seller.

PS: With estate sales, Coluzzi often invites the sellers to see how the house turned out. “We had the sellers come walk back through after updates,” he says. “Since some people find healing in that opportunity.”

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