CEO of invitation housingThe nation’s largest single-family rental landlord said he believes the recently passed housing bill, which bans investors like him from buying existing homes, will eventually lower home prices, but not in the short term.
“We definitely believe that will happen in the medium to long term,” said Dallas Tanner, CEO of Invitation Homes. “I think 90% of the bill is focused on deregulation. How do we simplify the capital coming into housing? Is there a way to facilitate the supply-side agenda? I think it’s a little difficult overnight in the short term because there’s a lot more to the story than what this bill addresses.”
Tanner pointed to fluctuating mortgage rates, high construction costs, and disparities in zoning and regulations.
In early January, President Donald Trump called for a ban on large investors buying single-family homes for rent. “People live at home, not at work,” he posted on social media. This was part of a larger effort to address the housing affordability crisis. Some argued that institutional investors were forcing owners out of the market and inflating home prices.
The ban became law in July, preventing investors who own more than 350 homes from buying any more existing units. However, you can purchase new single-family homes that are built specifically for rental. That’s where Invitation Homes focuses its efforts.
“Our focus as an industry and as a company has been how to create new supply and integrate it into today’s housing system. In partnership with builders, we have built or acquired more than 6,000 new homes over the past five years,” Tanner said.
In January, just weeks after Trump’s post, Invitation Homes acquired homebuilder Resibilt. We also purchase homes from major public construction companies, including: Pulte Homes and lenner Use it as a rental.
“We’ve found through trial and error that this new product, this beta product, the product that we’re doing in the development of these master plans, works really, really well for our families. So we’re indexing that and that’s part of our growth strategy,” Tanner said, adding that the company is selling hundreds of older rental properties.
According to various sources, the largest investors, those who own more than 1,000 homes, account for less than 3% of the single-family rental market. But it has an outsized footprint in certain metropolitan markets, including Atlanta (accounting for 25% of single-family homes), Jacksonville (21%) and Charlotte (18%), according to the Urban Institute.
Invitation Homes reported better-than-expected revenue at the end of July, even though rents and demand are not as healthy as they were during the first few years of the pandemic.
“We’ve seen a kind of fundamentals reset, and we talked about that in our last earnings call. We’re actually starting to see some pretty positive green shoots in some of our markets,” Tanner said. “But what we’re really focused on is how do we get through this and what does this mean?”
