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72 fail on a grand scale, the government stepped in and formed the Resolution Trust Corporation to clean it up. e ensuing fire sale of commercial assets attracted capital like a dinner bell, and the government stepped in again to facilitate by exempting REITs from federal corporate tax. at rule change in 1993 ushered in the modern era of REITs, and institutional capital flowed into commercial real estate at a feverish pace. A couple of decades later, the $3.4 trillion asset class of multi-family housing is 55 percent institution-owned, according to the U.S. Census Bureau and Amherst InsightLabs. at's almost $2 trillion in rental housing owned at the institutional level. What kept single-family rental housing from following this path? For one thing, the market crash in single-family didn't happen in the late 1980s; it happened 20 years later. e similarities are striking. Changes in government policy lead to risky lending practices, which leads to a bubble and a bust. Government and emergency managers take over to work out the mess. Investor capital comes flowing in. INVESTORS SAVE THE DAY When the housing market was flat on its back in 2010 and the daily drumbeat on cable news was about a housing collapse, homebuyers were hiding under their beds and demand was down. e negativity caused millions of people to forget what they knew intuitively— that the housing market's health was tied to raw population growth, and a recovery was inevitable. Homebuyers could not see that the crisis was explainable, self-inflicted, and temporary. Millions of people literally walked away from houses they could afford, but believed the talk of meltdown and ran away. Seven years later, that home is worth more than they paid, but their credit still suffers. e herd lost faith, but there was another category of demand that didn't. People that maintained their belief that when it comes to housing in the U.S., after a crash comes a boom. You know the players: Invitation Homes, American Homes 4 Rent, Colony, American Residential Properties, Waypoint, Amherst, Progress Residential, Silver Bay, and the rest of the pioneers of institutional SFR. e leaders of these companies deserve credit for betting the farm when the rest of the market was running scared. eir investment, along with tens of thousands of small- and mid-sized investors, gave the market a bottom in 2011. at was the year prices flattened and the recovery began. According to RealtyTrac, homebuyer demand fell 17 percent in 2011, while investor purchases soared more than 40 percent. Investors rarely get credit for it, but they were truly the heroes of the housing crisis. e largest investors were confronted with a task many thought impossible. Prominent players in commercial real estate said that acquiring, renovating, leasing, and managing thousands of houses across the country could not be done. Literally, at a time in history when we are all carrying supercomputers in our pockets, some of the brightest minds in commercial real estate asserted that large-scale SFR was impossible. Like pioneers settling a new land, the first major SFR investors were confronted with a dense forest they needed to cross. With the help of a new industry of innovators, they hacked their way through, got to the other side, and proved that SFR can generate "A couple of decades later, the $3.4 trillion asset class of multi- family housing is 55 percent institution- owned, according to the U.S. Census Bureau and Amherst InsightLabs. That's almost $2 trillion in rental housing owned at the institutional level."

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