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- March 5, 2026
- News
If I had to describe the current Build-for-Rent and Single-Family Rental markets in one word, it would be uncertain.
In a lot of ways, we’re still in a similar spot to where we were in Q4 2025. Rates have come down a bit. There’s been some movement in the treasuries. But overall, there’s still a lot that borrowers and capital providers are trying to unpack.
The recent policy discussion around restricting institutional buyers from purchasing homes has added another wrinkle. It’s not that activity has stopped, but it has caused pause in certain parts of the market.
What I’m seeing right now isn’t a shutdown. It’s more of a wait-and-see environment. And in environments like this, smart capital structure and the ability to adjust matter more than ever.
Flexibility Is Winning Right Now
One of the clearest shifts I’m seeing is a preference for shorter loan terms, especially 5-year structures.
Even though rates have eased slightly since late 2025, there’s still enough uncertainty that a lot of borrowers don’t want to lock into long-duration debt right now.
This is especially true for clients coming up on refinances from 2021 loans. Many of those borrowers are trying to decide whether to commit long-term in this environment or preserve flexibility.
A 5-year term gives them options.
If rates come down over the next three to four years and conditions improve, they can refinance again. If things remain volatile, they haven’t locked themselves into a long-term structure at a moment that may not have been ideal.
In this market, flexibility is often more valuable than squeezing out every last basis point.
What We’re Recommending to Clients
In this environment, our conversations with clients tend to fall into two buckets.
First, for acquirers: there is still opportunity, but you need to be disciplined. Underwrite conservatively and be realistic about rent growth and exit timing. Don’t let uncertainty paralyze you if the deal makes sense.
Second, for borrowers facing refinances: preserve optionality.
A lot of clients are coming up on maturities from 2021 loans. For many of them, we’re discussing 5-year terms as a way to stay flexible. If the market improves, they can reposition. If not, they’ve avoided overcommitting at the wrong time.
There’s no perfect answer in a murky market. But there are smart ways to structure around uncertainty.
Why Experience Matters More When Things Are Unclear
What you see in this industry is that when markets are clear and capital is flowing freely, almost anyone can execute. When things are murkier, experience matters a lot more.
At Encore Finance, we’ve been operating in this space for a long time. Our team spans originations, underwriting, and capital markets, and many of us have been through multiple cycles.
That doesn’t eliminate uncertainty. But it does help when clients are weighing tradeoffs between short-term flexibility and long-term commitment, or trying to decide whether now is the right time to expand.
The BFR market isn’t stalled, it’s adjusting. And for builders and operators who are willing to adapt (particularly mid-level players) there’s still meaningful opportunity ahead.
If you’re trying to decide how to structure your next move, we’re happy to walk through it with you. Contact us here to start the conversation.
