(Bloomberg) — Blackstone Group Inc.’s new single-family rental strategy is a $6 billion bet that tight housing markets will lead Americans to seek new ways to get suburban housing.

The private equity giant agreed to buy Home Partners of America Inc., a rental company that owns more than 17,000 houses, according to a statement on Tuesday. The company gives tenants the option of buying their rental at a predetermined price, making it unique among large single-family landlords.

Blackstone’s acquisition comes at a time when remote work and school have whipped up demand for suburban homes, pricing would-be buyers into rentals and creating consumer appetite for new ways to purchase a house.

“This is a pathway to home ownership that works for people,” said Kathleen McCarthy, global co-head of Blackstone Real Estate. “There’s strong demand for that and an opportunity to grow.”

Single-family rentals have been a favorite bet over the past year, as real estate investors seek new places to invest during a pandemic that kept Americans away from offices, hotels and malls.

Blackstone, which built Invitation Homes Inc. into the largest single-family landlord following the U.S. foreclosure crisis, has rekindled its interest. Last August, it led a group of investors that acquired a minority stake in Toronto-based Tricon Residential Inc., which owns and operates more than 31,000 homes and apartments.

“Clearly the tenant demand is still robust, and that’s driving significant cash flow increases at the property level,” said Jeff Langbaum, an analyst at Bloomberg Intelligence. “Smart people with smart money want to get a piece of that.”

For Blackstone, there may also be a case of sellers regret. The company exited its stake in Invitation Homes in 2019, selling the last of its position at $30.10 per share.

Blackstone made about $7 billion on its stake in Invitation, more than doubling its money, Bloomberg reported at the time. But shares in the company have increased by 25% since then.

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The flood of investor capital comes as low inventory pushes prices higher at the fastest pace ever, and tenants opt for rental houses over apartments. Invitation Homes posted an occupancy rate of more than 98% in the first quarter, allowing the industry giant to increase rents on new leases at a record rate.

Rising rents and low inventory have also made single-family landlords a target across the political spectrum. Conservative book author J.D. Vance started a firestorm on Twitter recently by arguing that Wall Street investors were making it hard for regular Americans to buy homes.

In 2019, Democratic Senator Elizabeth Warren blasted Blackstone for “shamelessly” profiting from the U.S. foreclosure crisis, arguing that Wall Street’s investment in single-family homes was a “huge loss for America’s renters.”

Home Partners of America, which received backing from KKR & Co. and BlackRock Inc., has a business model that may help its new owner sidestep those criticisms. The company’s leases give tenants an option to buy their home during the first five years, providing renters time to save a down payment and improve their credit.

To date, roughly 20% of Home Partners’ tenants have exercised the option to purchase their home, McCarthy said. She added that Blackstone sees the opportunity to extend Home Partners’ market to more affordable price points.

(Updates with quote from Blackstone in third paragraph.)

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