Single-Family Homes Are the Largest Source of Affordable Rentals in the United States

By Arthur Gailes & Edward J. Pinto of AEI.

"Myth: Affordable housing is popularly conceived as primarily consisting of subsidies for people living in apartment buildings.

Market Reality: Nationwide, most of the least expensive rental housing comes from single-family 1-4 and mobile/manufactured homes.

Fifty-five percent of the people paying these least expensive rents live in single-family homes (1-4 units) or mobile homes, not in multifamily buildings.

That distinction between homes and people matters. Single-family homes have far more bedrooms on average—about 3.2 nationally, compared with 1.4 for large multifamily buildings. So even where multifamily buildings provide a large share of low-rent units, single-family homes can still house more of the people benefiting from least expensive rents.

This story holds true throughout the country. In a high-priced metro like Los Angeles, most of the least expensive rental units (54%) are multifamily. But most people (53%) in these units live in single-family 1-4 and mobile/manufactured homes.

The reason is mostly bedrooms. People, when they get together to form households, disproportionately live in single-family homes because they have the most affordable space. Most people live in homes with at least two bedrooms, and that is just as true for people with low incomes as it is for people with median or high incomes."

"Across most metros in the country, once we look at the population living in the least expensive rental units rather than simply counting rental units, single-family homes provide most of that housing (green).

The counterintuitive result is that not only do single-family 1-4 and mobile homes constitute the largest source of affordable rentals in the United States, but policymakers and voters should be skeptical about narratives that treat single-family rentals as a source of housing-cost problems. This includes animosity towards institutional investors. The homes that are most affordable for families to rent are disproportionately single-family 1-4 and mobile/manufactured homes."