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KBRA Releases Single-Borrower SFR Comprehensive Surveillance Report

29 Aug 2025   |   New York

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KBRA releases a Comprehensive Surveillance Report for the KBRA-rated universe of 41 outstanding single-borrower, single-family rental (SFR) securitizations. The transactions, which are sponsored by six SFR rental companies, have a combined remaining principal balance of $27.8 billion and are secured by 110,552 properties. The transaction structures consist of a total of 389 securities, of which 314 ($24.8 billion) are rated by KBRA.

In connection with this review, three ratings ($163.0 million) have been upgraded, and 311 ratings ($24.7 billion) have been affirmed. The upgrades and affirmations consider the overall macroeconomic conditions and performance of each individual transaction and its underlying collateral. In general, transactions have largely exhibited positive or stable performance trends in the form of stable to lower implied loan-to-value (LTV) ratios and/or stable or higher cash flows since issuance and/or prior ratings change, as applicable for seasoned transactions. However, home prices have remained relatively flat or have grown at a much slower pace compared to previous years leading to relatively less value appreciation in the transactions issued over the past two years. Additionally, cashflows from recent transactions have generally been under pressure as expenses have increased at a faster rate than rent growth. In addition, none of the underlying loans has ever been delinquent or specially serviced.

The report and supplemental report provide various key credit metrics that were analyzed and compared to both issuance and ongoing performance data for the individual transactions, which provide useful insights into the overall performance of each issuer’s securitized portfolio. Finally, the publication also provides key takeaways from our analysis, some of which are as follows:

  • Valuations for 101,736 of the underlying properties in transactions which have seasoned 13 months or more (34) have appreciated, on average, by 22.9% since the issuance and 0.8% since last year, as measured by changes in CoreLogic’s zip code-level HPI data as of May 2025.
  • For the 41 transactions covered in this report, the average LTV at issuance was 85.5%, while the current Implied LTV is 73.1%. The average Implied LTV as of KBRA’s last review in August 2024 was 68.7%. The slight rise in the implied LTV is due in part to the payoff of four seasoned transactions. In comparing the 37 transactions still outstanding from the last review, the current review has a lower average Implied LTV at 72.2% versus 72.9%, owing to slight home price appreciation and principal paydowns since the last review.
  • On average, the servicer reported Net Operating Income (NOI) is 7.6% higher than the issuer’s underwritten NOI at securitization for the 37 seasoned transactions where available. Four of the most recently issued transactions have yet to report updated NOI figures since issuance owing to limited seasoning.
  • The servicer reported NOI was higher than the sponsor’s underwritten figure at issuance for 27 of the 37 transactions where servicer reporting was available. The 10 transactions which have reported a lower NOI than the sponsor’s underwritten figures include two FirstKey, five Progress, two Tricon and one Starwood transaction, with an average decline of 5.5%, ranging from -23.2% (Starwood 2022-SFR3) to -0.6% (FKH 2022-SFRA). These transactions have experienced a 12.5% increase in rent, with a 40.4% increase in operating expenses. The 27 transactions with an average 12.5% positive NOI growth experienced a 19.4% increase in rent versus 26.8% increase in operating expenses. All the loans collateralizing each transaction have a KPO of Perform with the exception of Starwood 2022-SFR3 due to its financial performance.
  • Contractual rental rates (rent per property) have increased by 16.7% since issuance, on average, across the outstanding transactions with reporting information available. Generally, the deals with the most seasoned portfolios have experienced the greatest rental appreciation. Average rental rates for the 2014 through 2021 vintages climbed between 1.9% and 50.6%, while those issued in 2022 and 2023 have increased between 1.8% and 37.9% on an absolute basis since securitization. Contractual rent figures for the transactions captured during those years equate to annualized increases of between 2.6% and 6.6% per year. The 2024 and 2025 vintages have seen rental rates climb between -0.1% and 5.9%.
  • The current average vacancy rate across all portfolios is 4.7%, compared to the average of 4.9% and 5.3% for KBRA’s August 2024 and September 2023 reviews, respectively. Tenant delinquency rates currently average 1.0% which is below the average of 1.6% at KBRA’s August 2024 review and the average of 2.5% for the September 2023 review.
  • The average NOI Debt Service Coverage ratio (DSC) has increased since issuance from 1.73x to 1.90x. In addition, the average NOI Debt Yield (DY) has increased from 5.5% to 6.0%.

Details concerning the classes with rating changes are as follows:

  • TAH 2020-SFR1 Class D to AA (sf) from AA- (sf)
  • TAH 2020-SFR1 Class E to AA- (sf) from A+ (sf)
  • TAH 2020-SFR1 Class F to A (sf) from A- (sf)

Click here to view the report.

For additional information regarding a specific transaction, see the list below to access ratings, reports, and disclosures:

Related Publications

Methodologies

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

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