Single-Family Rentals as a Platform for Economic Mobility in the United States

Housing has long played a central role in economic mobility in the United States. Stable access to safe, well-located homes influences educational attainment, workforce participation, health outcomes, and long-term wealth accumulation. For decades, homeownership has been viewed as the primary vehicle through which families access these benefits. Yet structural changes in the housing market have made the transition from renting to owning increasingly difficult for a large segment of American households.

In this environment, single-family rentals (SFRs) have emerged not simply as an alternative housing tenure, but as a potentially important platform for stability and upward mobility. When thoughtfully developed and responsibly operated, SFR housing can help families access opportunity today while preserving flexibility for tomorrow.

A Housing Market Under Strain

The current U.S. housing market is defined by persistent affordability challenges. According to the Harvard Joint Center for Housing Studies, the nation faces a structural shortage of millions of homes, particularly entry-level and family-sized units. This supply gap has driven prices higher and reduced availability, especially in high-opportunity regions.

At the same time, higher mortgage rates and elevated home prices have pushed the cost of owning well beyond the reach of many households. Freddie Mac and other housing economists note that the monthly cost differential between owning and renting is near historic highs in many metropolitan areas. As a result, even households with steady employment and moderate incomes often find themselves unable to qualify for a mortgage or assemble a down payment. Importantly, this shift has not diminished the aspiration for homeownership. Surveys conducted by the Federal Reserve show that a strong majority of renters still prefer to own a home. What has changed is the perception that the goal of home ownership in unattainable. 

Who Lives in Single-Family Rentals?

Single-family rental households differ meaningfully from both apartment renters and homeowners. Research from the Urban Institute and industry analysts consistently shows that SFR renters tend to be younger, more likely to have children, and more likely to be in active stages of career and family formation.

Many are middle-income households who earn too much to qualify for traditional housing assistance programs, but not enough to comfortably purchase a home in today’s market. Others are families who prioritize neighborhood quality, school access, and space, but value flexibility due to job mobility or financial uncertainty. For these households, renting a single-family home is not a fallback option; it is a deliberate choice that balances stability with adaptability. It allows families to live in residential neighborhoods, maintain consistent school enrollment, and establish community ties without assuming long-term financial risk prematurely.

Access to Opportunity Through Geography

One of the most underappreciated dimensions of housing is location. A substantial body of research shows that access to high-opportunity neighborhoods - those with strong schools, employment access, and lower exposure to crime - has lasting effects on children’s outcomes and adult earnings. Historically, many of these neighborhoods have been dominated by owner-occupied housing, creating barriers for families unable to buy. Single-family rentals can help bridge this gap by enabling households to access neighborhoods that would otherwise remain out of reach.

Research from the Federal Reserve Bank of St. Louis suggests that SFRs allow families to live in communities they could not enter as homeowners due to credit, income, or down payment constraints. In doing so, SFRs can contribute modestly to greater socioeconomic and racial integration, particularly in suburban markets. From a policy perspective, this matters. Housing is not merely shelter; it is a gateway to opportunity. When families gain access to safer environments and better educational resources through rental housing, the benefits can compound over time.

Stability Without Permanence

Another important contribution of SFR housing lies in its balance between stability and flexibility. Unlike short-term or transient rental arrangements, single-family homes are often leased for longer durations and attract residents seeking continuity.

This stability supports workforce participation, educational continuity for children, and community engagement. At the same time, renting preserves flexibility for households navigating job changes, caregiving responsibilities, or geographic mobility. Urban Institute research has shown that many households use rental housing strategically during periods of transition. In this context, SFRs offer a particularly effective format: they provide the physical and social characteristics of homeownership without requiring immediate financial commitment.

Single-Family Rentals as a Stepping Stone

While renting may be a long-term preference for some households, for many it remains a transitional phase. A growing body of research and market innovation suggests that SFRs can function as a stepping stone toward eventual homeownership.

Lease-to-purchase and rent-to-own models - when structured transparently and responsibly - allow households to stabilize their finances, build credit history, and accumulate savings while remaining in the same home. The World Bank and housing policy researchers have noted that such models can reduce entry barriers by addressing two of the most significant obstacles to homeownership: down payments and mortgage qualification.

Critically, these pathways work best when aligned with consumer protections and long-term affordability goals. Poorly designed programs can introduce risk, but well-governed models offer a meaningful alternative to binary rent-versus-own frameworks.

By integrating rental tenure with ownership preparation, SFR platforms can help families transition gradually rather than abruptly - supporting mobility without displacement.

Economic Mobility Beyond Ownership

It is also important to recognize that social mobility does not hinge exclusively on ownership. Research from the Center on Budget and Policy Priorities emphasizes that housing stability itself - independent of tenure - plays a central role in economic outcomes.

Families with stable housing are better positioned to pursue education, maintain employment, and manage health needs. Children experience fewer disruptions, which correlates with improved academic performance and long-term earnings.

Viewed through this lens, SFR housing contributes to economic mobility by delivering stability at scale. When homes are well-maintained, rents are predictable, and management practices prioritize long-term residency, rental housing becomes a platform for progress rather than precarity.

A Complementary Role in the Housing Ecosystem

Single-family rentals are not a substitute for homeownership, nor should they be viewed as a zero-sum competitor. Instead, they occupy a complementary position within a broader housing continuum.

As the housing market evolves, solutions that recognize diversity in household needs, timing, and financial readiness will be essential. SFRs offer flexibility where ownership is temporarily out of reach, access where geography matters most, and stability where families need it most. When paired with responsible ownership models, operational discipline, and long-term alignment between residents and communities, single-family rentals can support a more inclusive and resilient housing economy.

Looking Forward

The challenges facing the U.S. housing market are significant and unlikely to be resolved through any single intervention. Addressing affordability, supply constraints, and inequality will require coordinated efforts across public and private sectors.

Within that broader effort, single-family rentals represent a practical and scalable tool. By expanding access to family-sized housing, opening doors to opportunity-rich neighborhoods, and supporting gradual pathways to ownership, SFRs can play a constructive role in advancing social mobility.

Housing outcomes shape economic outcomes. As the housing economy continues to adapt, the thoughtful deployment of single-family rentals offers one way to ensure that opportunity remains within reach for more American families.

Sources

• Harvard Joint Center for Housing Studies. State of the Nation’s Housing, 2024–2025.

• Federal Reserve Bank of St. Louis. “The Role of Single-Family Rentals in the U.S. Housing Market.”

• Urban Institute. Research on rental housing, neighborhood access, and family mobility.

• Freddie Mac. Housing affordability and homeownership access data, 2024–2025.

• Center on Budget and Policy Priorities. Research on housing stability and economic outcomes.

• World Bank. “Can Rent-to-Own Models Expand Access to Homeownership?”