Invitation Homes Inc. (INVH)

Invitation Homes owns individual houses and rents them to families — not flats but houses with a yard.

Demand is fed by arithmetic: when mortgages are expensive the monthly payment on a purchased house is markedly higher than rent on the same one, and a family that needs a yard and a school district rents instead of buying. The dearer the money, the stronger the effect.

Managing thousands of scattered houses is harder than one building: repairs, maintenance and turnover have to be industrialised, and it is scale that makes the model work. Risks: political attention to institutional owners of housing, rental restrictions, and insurance and property taxes rising faster than rents. The trust form obliges distributing profit.