Sale-leaseback transactions have been common in certain aspects of the commercial real estate market—and now may be spreading to other sectors. A new analysis from Trepp Commercial about the single-family housing market sees an opportunity for homeowners to use sale-leaseback structures to pull equity out of their homes without having to move.

More significantly, institutional players also see an opportunity in this area. One indicator of this interest comes from Invitation Homes, which, per the Wall Street Journal, is planning a sale leaseback program as another channel to add to its 80,000 homes.

The pandemic has catalyzed the potential for sale-leaseback transactions to find a place in the single-family market. While the housing market is much more stable today than it was during the last recession—when many homeowners faced foreclosure—the market has been stabilized partially by widespread forbearance policies. When those policies expire or when past-due mortgage payments add up, homeowners may look for an alternative option. Like in a commercial deal, a sale-leaseback could help homeowners stay in their homes without the responsibility of a homeownership, Trepp says.

Want to continue reading?
Become a Free ALM Digital Reader.

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.