|Last Quarterly Update:||10/17/2016|
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Companies in this industry invest in residential properties to generate wealth, primarily through rental income and capital appreciation. Major US-based companies include Equity Residential, AvalonBay Communities, Essex Property Trust, and AIMCO Properties. Outside the US, major companies include Sun Hung Kai Properties (Hong Kong), Leoplace 21 (Japan), Kerry Properties (Hong Kong), CapitaLand (Singapore), and GAGFAH (Luxembourg).
International residential real estate investment is popular in markets with high population growth, rising wealth, and limited housing supply. The top five housing markets for global investors include the US, the United Arab Emirates, Singapore, the UK, and Spain, according to real estate advisor Savills.
The US residential property investment industry includes about 66,000 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $98 billion.
Residential real estate investment trusts (REITs) are included in this industry and are further discussed in a separate REITs industry profile.
Demand is driven by the supply of investment capital and demand for rental property. The profitability of individual companies depends on property values and rental rates, which are tied to the general health of the economy. Large companies have advantages in financial resources, while small companies can compete effectively by developing expertise in local markets. The US industry is fragmented: the top 50 companies account for about 30% of revenue.
Residential property investment may compete with mutual fund management and securities brokerages for investment ...
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