Phoenix is strengthening its position as a leading U.S. build-to-rent (BTR) and single-family rental (SFR) market, supported by population growth, housing affordability pressures and continued demand for suburban living.
The Phoenix-Mesa-Chandler metro added approximately 59,000 residents between 2024 and 2025, bringing its population to more than 5.2 million. While growth has moderated from pandemic-era levels, continued migration and employment expansion are supporting long-term rental demand.
Affordability Is Extending the Renter Lifecycle
The widening gap between renting and owning is a major driver of Phoenix's rental market. Higher mortgage rates, home prices, insurance costs and down-payment requirements have made purchasing increasingly expensive.
Realtor.com recently ranked Phoenix third among major U.S. metros where renting is more affordable than buying, with owning a starter home costing nearly $1,200 more per month than renting.
This is encouraging households to rent longer, benefiting BTR communities that offer many features associated with homeownership—including more space, private yards, garages and suburban neighborhoods—without the financial commitment of buying.
Suburban Growth Supports BTR
Phoenix's suburban expansion also aligns well with the BTR model. Areas including Buckeye, Goodyear, Surprise, Queen Creek, Gilbert, Chandler and parts of Mesa are attracting residents and investment due to housing availability, employment growth, schools and infrastructure.
However, Phoenix is also absorbing a significant pipeline of new housing, which could place near-term pressure on rent growth. As a result, investors are becoming more selective and focusing on individual submarket fundamentals rather than Phoenix as a whole.
Outlook Remains Strong
Despite near-term supply pressures, Phoenix's long-term BTR outlook remains favorable. Population and employment growth, suburban household formation and the substantial cost advantage of renting continue to support demand.
For investors and developers, success will increasingly depend on selecting the right submarkets, delivering the right rental product and maintaining competitive pricing.
Source: GlobeSt.
