We had a lot of questions for corporate landlords. Here’s what they had to say.
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Security For Sale: Converting NC homes to rentals
Institutional investors have bought at least 40,000 single-family homes across North Carolina in the past decade and now rent them out. The industry — primed for continued growth — says it improved the rental experience, providing safe, affordable houses that were previously inaccessible to renters. But owning a house traditionally offered financial security for most American families. And our investigation finds the business model of these companies is finely tuned to squeeze profit from the homes, often to the detriment of renters, neighbors or other would-be buyers.
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During the course of our investigation into the rise of institutional investors buying up tens of thousands of North Carolina homes and converting them into rentals, we consulted a bunch of sources.
We spent months digging into property records, academic research and complex financial documents, on top of meeting with tenants, neighbors, industry groups, Realtors, activists and government officials.
But we also wanted to hear from the companies themselves. We wanted to know how they operate in North Carolina and why they were making certain business decisions we were hearing about from tenants and researchers.
We decided to focus on six of the largest corporate landlords in North Carolina: American Homes 4 Rent, Amherst Residential, FirstKey Homes, Invitation Homes, Progress Residential and Tricon Residential. These aren’t the only institutional investors buying and renting homes in the state, but they’re the ones that figured most prominently in our reporting.
None of the companies granted us an interview, either in-person or over the phone, so we sent each of them a detailed list of questions. We asked if our data on how many homes they owned matched their records; if they had specific responses to tenant claims or to the complaints filed against them with the North Carolina attorney general; and about their business practices.
No company answered all of our questions. Some responded to a portion of them and sent more general statements. Other companies responded only with talking points all their own.
Here are relevant excerpts from each company’s response:
American Homes 4 Rent
“At American Homes 4 Rent, we acquire and build homes in places where people want to live,” Megan Grabos, spokeswoman for the company, wrote in an emailed statement. “As one of the top homebuilders in the country, we are doing our own small part to alleviate the nationwide housing crisis by building new home communities designed for durability and efficiency.
“We are taking this purpose-driven approach to growing our footprint in the greater Charlotte area by building homes for the modern lifestyle and offering residents an excellent experience to expand the region’s supply of high-quality housing and help our communities thrive.”
Amherst Residential
“We invest an average of $40,000 renovating, repairing and improving each home we acquire as we make long-term investments in all of our communities,” spokesman Dan Scorpio wrote in a statement. “We serve consumers by providing quality, accessible and affordable housing to those who are ready to move on from multi-family living, have a need for more space, a more private environment or because their families are growing.
“Consumers often rent because tightened credit standards and high student debt burdens have made home ownership currently out of reach. We invest heavily to provide around-the-clock service and responsive maintenance support for our residents, and our consistently high annual renewal rate shows that our residents overwhelmingly enjoy their experience living in our homes.”
FirstKey Homes
“We believe in reliable resident service as a top priority, and if we miss our high-quality standard, we make it right and learn from it,” Cashona Rinehart, regional vice president of FirstKey, wrote in a statement. “It’s why we have locally staffed offices with licensed maintenance technicians, invested in a mix of high-quality maintenance programs, including a dedicated call center and new online resident service program, and spent roughly $150 million on the care of our homes.”
Rinehart wrote that the company responded to tenant complaints and maintenance requests to the best of its ability. Rinehart also pointed to FirstKey’s top rating with the Better Business Bureau.
Invitation Homes
“Invitation Homes is proud to provide high quality homes to the growing number of Americans who choose to rent versus own,” Invitation spokeswoman Kristi DesJarlais wrote. “Our associates genuinely care about ensuring we provide an exceptional experience for our residents, and our teams work hard every day to honor the trust that 80,000+ families and individuals have placed in us to provide them a safe and secure home.
“We offer multiple channels through which residents can communicate with our team regarding the status of their home, lease, or other issues that may arise. We respond as quickly as we can to residents’ requests and work diligently to address issues in a timely and efficient manner. Invitation Homes is aware of the complaints filed in North Carolina and has worked with residents to resolve each of them.”
Progress Residential
Kate Thompson, a spokeswoman working with Progress, noted that Progress had worked with its tenants to close all the complaints that had been filed against them with the North Carolina attorney general.
Tricon Residential
“At Tricon, we feel honored to be able to provide people with a place to call home, and we take that responsibility seriously,” Kevin Baldridge, Tricon’s chief operating officer, wrote in a statement. “We have invested over $134 million in the renovation of newly acquired single-family homes so we may improve our residents’ living experiences. Every day Tricon team members work hard to provide our residents with genuine caring service, which is why we have average resident tenures of three to five years and longer.
Baldrige also said Tricon has hired hundreds of new maintenance technicians to help keep its homes in good shape.
“We have a long-standing practice of limiting annual rent increases for existing residents at rates well below industry averages. We also have programs that help our residents achieve home ownership if that is their goal. We believe when families have the stability necessary to build pathways to their own financial freedom, entire communities can prosper.”
This story was originally published May 3, 2022 at 6:00 AM with the headline "We had a lot of questions for corporate landlords. Here’s what they had to say.."
