SIC 6514 Operators of Dwellings Other Than Apartment Buildings

SIC 6514

This industry includes establishments primarily engaged in the operation of dwellings other than apartment buildings. By definition, such dwellings contain four or fewer housing units. This industry does not include hotels, rooming and boarding houses, camps, and other lodging places for transients. Hotels and motels are classified in SIC 7011: Hotels and Motels; rooming and boarding houses are classified in SIC 7021: Rooming and Boarding Houses; and camps are covered in SIC 7032: Sporting and Recreational Camps.

NAICS CODE(S)

531110

Lessors of Residential Buildings and Dwellings

This segment of the real estate industry is small with an estimated worth of $5.26 billion in the mid-2000s and primarily populated by individual owners of rental properties (generally houses). Large chains or companies are a relatively small presence, typically limited to regional influence. As an established, albeit minor, element of the larger real estate industry in the United States, establishments involved in this industry are influenced by the same economic and social factors that impact the largest real estate property management firms. The U.S. Census Bureau estimated some 10,250 establishments in this category in the mid-2000s.

As the U.S. economy surged, beginning in 1992 and continuing into the new millennium, rental properties in general became more appealing to small investors, both companies and individuals. Individual investors began to put more capital into investment properties even though federal tax changes in the late 1980s had limited deductions on investment property. Many of these individuals sought small properties in which to invest so that mortgages would be manageable or not necessary.

However, the economic downturn of the early 2000s, exacerbated by the terrorist attacks of September 11, 2001, sent the economy into a tailspin. To bolster consumer spending, the Federal Reserve reduced interest rates to historic lows, which, in turn, fueled the home buying market. Property values rose substantially as many Americans hurried to purchase or refinance while the rates were low. With the number of home owners rising, the number of people seeking rental property declined proportionally, leaving the residential rental market with a lack of demand and a supply surplus. By 2005 it was a renters' market, with property managers sometimes offering rent rates below their property mortgage payment to...