Orlando’s once-booming Build-to-Rent (BTR) market is showing signs of cooling. Recent trends indicate a shift away from rental properties towards traditional for-sale homes.
The Cyrene Project and Market Changes
The Cyrene project in Hills of Minneola, originally planned as a rental community by Curve Development, has been sold to Meritage Homes. This homebuilder, having exhausted its lot inventory in the area, plans to convert the project into for-sale homes. This is just one example of a broader pattern.
Sun Terra Communities is also selling two other Cyrene projects to homebuilders, who intend to repurpose them as for-sale communities. Additionally, a planned BTR cottage community has been redesigned as a for-sale townhome development.
Reasons for the Shift
- Higher demand for for-sale homes: The current market favors homeownership over renting, offering better returns for developers and builders.
- Economic factors: Rising interest rates, construction costs, and impact fees are making BTR projects less financially viable.
- Market saturation: The rapid growth of BTR communities in recent years has led to increased competition and lower rental rates.
Implications for the Orlando Market
While the BTR market is cooling, it’s important to note that traditional homebuilders are still actively involved in the sector. Companies like D.R. Horton and Pulte are selling large numbers of homes to institutional investors for rental purposes.
Overall, the Orlando real estate market remains dynamic, with developers and builders adapting to changing conditions and exploring new opportunities.
Would you like to know more about specific developments or the impact of these changes on rental prices in the Orlando area?