Invitation Homes CEO Dallas Tanner told CNBC on Friday the U.S. housing market remains “healthy,” downplaying concerns that the sharp rise in prices during the Covid pandemic is creating bubble-like conditions.
That fact, combined with tighter mortgage lending standards instituted after the 2008 crash, lead Tanner to believe the housing market is in solid shape. As a result, he said, he’s not concerned about acquiring new properties for his Texas-based company, which rents single-family homes,
“I would expect that home prices stay relatively stable, if not continue to grow in value for the homeowners in the country, but we’ll find our ways to pick our spots whether through our partnerships with builders or our ability to buy one-off,” Tanner said. “We view the housing environment overall as extremely healthy.”
The housing market has been one of the strongest parts of the U.S. economy during the coronavirus pandemic, although there are some indications it has recently been cooling somewhat.
“For the past couple of weeks, housing has been hot instead of blazing hot, and it’s actually probably good for the market,” Redfin CEO Glenn Kelman told CNBC last week.
But looking further out, Tanner said the fundamental conditions are supportive. Demographic trends, in particular, are powerful right now, he said.
“You have this wave of millennials coming our way,” with tens of millions of people looking for housing, Tanner said. “So, as you start to think about, would we see a decrease in either home purchasing or home leasing? We just don’t see it.”
In fact, Tanner said sees the need for more “quality, affordable housing” across all categories to be available in the U.S. He noted that the number of single-family homes being built each year — roughly 1.5 million units — is similar to levels from the late 1990s.
“Whether it’s fee simple and somebody wanting to purchase, a for-lease product like we provide or even some of these ancillary programs that are meant to benefit the consumer and give them quality choice along their journey, I think there’s actually an appetite for all of that product today in the U.S.,” he said.