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Build-to-rent: A new housing trend is growing in North Carolina

Build-to-rent: A new housing trend is growing in North Carolina As the demand for housing remains strong in North Carolina and development continues across Wilmington, one trend is gaining momentum both locally and statewide: build-to-rent communities. The Wilmington area is home to more than 4,000 build-to-rent units, with nearly 2,600 in the leasing stage, according to a 2024 build-to-rent market report from Berkadia, a national multifamily real estate investment firm. "Wilmington is a growing market with a really healthy university and a really healthy airport and great employment and (it's) an attractive place where people want to live," Caleb Troop, senior managing director of Berkadia, said. "That's why we're continuing to see these prop up." What is a build-to-rent community? A build-to-rent community is a residential development featuring professionally managed single-family homes or townhomes, either attached or detached, often with garages and backyards. Frequently, the amenities of build-to-rent communities are the same as offered at a traditional apartment complex, featuring dog parks, a pool, a clubhouse, a gym, and more, Troop said. Though, the units themselves and the outlay of the community differs. "Build-to-rent can mean different things and can look different, but it typically is less dense, more suburban, (and) more rural than infill," Troop said. "Typically, (it) is a little bit quieter (with a) lower unit count (and) feels more like a suburban residential community." What's driving the demand? While the rise of build-to-rent communities was largely triggered by the Great Recession in 2008, the COVID-19 pandemic further shifted demand, prompting a surge in supply to meet it. Within the last three to five years, the build-to-rent trend migrated across the sunbelt from the west coast into the southeast, Troop said. "It really kind of caught on over here in a ... post-COVID world where people wanted a little bit more breathing room, wanted a little bit more privacy (and) wanted some more square footage because they were working from home," Troop said. "Renters were using their homes more, still wanted to be renters, but wanted a larger space, more storage, a garage, etcetera." Real estate trends: What will be trending for luxury real estate in 2025? This report tells you The pandemic also boosted population growth in the southeast, Dr. Mouhcine Guettabi, Wilmington's regional economist and associate professor of economics at the University of North Carolina Wilmington, previously told the StarNews. The migration of people into Wilmington, coupled with the availability of relatively affordable land compared to other major metro areas along the Eastern Seaboard make Wilmington a prime market for build-to-rent developments, Troop said. While more people are renters by choice, high interest rates are also pushing many to rent instead of buy. When asked about the impact of build-to-rent communities on homeownership opportunities in the area, Troop said he doesn't view it as a negative. "If the demand weren't there, these developers wouldn't be building them," Troop said. "If the demand for rental communities ... dries up, some of these might be converted to for-sale communities, and that's one of the beauties about the build-to-rent space." How many build-to-rent communities are located in the Wilmington-area? Berkadia provided a list of build-to-rent communities located across Brunswick, New Hanover and Pender counties: New Hanover County Seaboard at Sidbury Station - 6105 Dichondra Drive, Wilmington. 113 single-family units built in 2023. - 6105 Dichondra Drive, Wilmington. 113 single-family units built in 2023. Pinnacle Townhomes - 8764 Sandy Ridge Loop, Wilmington. 60 townhomes built in 2022. - 8764 Sandy Ridge Loop, Wilmington. 60 townhomes built in 2022. The Townhomes at Beau Rivage - 100 Beau Rivage Drive, Wilmington. 120 townhomes built in 2018. - 100 Beau Rivage Drive, Wilmington. 120 townhomes built in 2018. Villas at Echo Farms - 309 Saint Annes Moor, Wilmington. 62 townhomes built in 2023. - 309 Saint Annes Moor, Wilmington. 62 townhomes built in 2023. The Cottages at Riverlights - 406 Ledbury Road, Wilmington. 279 cottage-style units built in 2024. - 406 Ledbury Road, Wilmington. 279 cottage-style units built in 2024. Banyan Silo Ridge - 24 Winnow Walk, Wilmington. 299 single-family units built in 2025. - 24 Winnow Walk, Wilmington. 299 single-family units built in 2025. Hamlet Barclay West - 3152 S. 17th Street, Wilmington. 280 single-family units under construction. - 3152 S. 17th Street, Wilmington. 280 single-family units under construction. The Hamlet at Barclay West II - 3152 S. 17th Street, Wilmington. 280 single-family units under construction. Brunswick County Heartsease at Shallotte - 500 Seaforth Street, Shallotte. 83 cottage-style units built in 2022. - 500 Seaforth Street, Shallotte. 83 cottage-style units built in 2022. The Pines at Highland Forest Townhomes - 56 Highland Forest Circle, Shallotte. 58 townhomes built in 2016. - 56 Highland Forest Circle, Shallotte. 58 townhomes built in 2016. Leland Station - 7521 Leland Station Drive, Leland. 120 townhomes built in 2020. - 7521 Leland Station Drive, Leland. 120 townhomes built in 2020. Jackey's Ridge - 9102 Pine Notch Road, Leland. 59 single-family units built in 2023. - 9102 Pine Notch Road, Leland. 59 single-family units built in 2023. Encore at Westgate - 2626 Goose Island Drive, Leland. 240 townhomes built in 2024. - 2626 Goose Island Drive, Leland. 240 townhomes built in 2024. The Landing at Stone Chimney - 107 Little Doe Place SW, Supply. 121 single-family units built in 2024. - 107 Little Doe Place SW, Supply. 121 single-family units built in 2024. Bountiful Village - No address provided. Leland. 35 townhomes built in 2023. - No address provided. Leland. 35 townhomes built in 2023. Summer Bay Villas - W Gate Drive, Leland. 79 townhomes built in 2023. - W Gate Drive, Leland. 79 townhomes built in 2023. Beckington Townhomes - 1000 Old Fayetteville Road, Leland. 132 townhomes built in 2023. - 1000 Old Fayetteville Road, Leland. 132 townhomes built in 2023. Isabella Courts - No address provided. Leland. 169 townhomes built in 2023. - No address provided. Leland. 169 townhomes built in 2023. Carolina Crossing - 1909 Boynton Way, Bolivia. 249 townhomes built in 2023. - 1909 Boynton Way, Bolivia. 249 townhomes built in 2023. Cape Cottages - 2909Shoals Point Way, Leland. 315 cottage-style units built in 2023. - 2909Shoals Point Way, Leland. 315 cottage-style units built in 2023. Hawthorne Waterside Cottages - 7111 Rock Fish Lane SE, Leland. 159 cottage-style units built in 2022. - 7111 Rock Fish Lane SE, Leland. 159 cottage-style units built in 2022. Egret Landing - 3021 Siskin Drive NW, Calabash. 198 townhomes built in 2024. - 3021 Siskin Drive NW, Calabash. 198 townhomes built in 2024. Arboretum at Brunswick Village - 4118 Hobblebush Drive, Leland. 104 townhomes under construction. - 4118 Hobblebush Drive, Leland. 104 townhomes under construction. Leland Townhomes - 10000 Old Fayetteville Road, Leland. 254 townhomes under construction. - 10000 Old Fayetteville Road, Leland. 254 townhomes under construction. Overlook at Jackey's Creek - 2708 Tulip Street, Leland. 67 single-family units under construction. Pender County The Reserve at Blake Farm - 127 Edison Avenue, Wilmington. 240 townhomes built in 2022. Looking ahead While Wilmington's overall build-to-rent unit count is comparable to Raleigh's, it has about 1,000 more units currently in the leasing stage, according to the market report. "The governmental leadership in Wilmington ... (has) seen the obvious demand and need for additional housing, whether that's for sale or rent, and they've been accepting within certain boundaries ... so it's made it a bit easier for developers and builders to come in and meet the demand that's already there," Troop said. Though, Wilmington has approximately 600 fewer build-to-rent units currently under construction compared to Raleigh. Troop said the development of build-to-rent communities in Wilmington will likely peak in the next five years, with new deliveries tapering off as a result of slower-than-expected rent growth, increased construction costs post-COVID, labor shortages, tariff concerns, and more. "We'll see what the future holds as it relates to some of those factors like inflation and rent growth and interest rates," Troop said.