AMH - Earnings call transcript Q2 2018

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Operator

Greetings, and welcome to the American Homes 4 Rent Second Quarter 2018 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Stephanie Heim. Please go ahead.

Stephanie Heim

Good morning. us second joining conference XXXX for call. you for quarter our earnings Thank with Executive Officer Singelyn, Chief here Dave I'm today Chief X and Lau, Homes Operating Chris Officer; Chief American Financial of Rent. Officer; Corrigan, Jack the this may that include advise call I to statements. At outset, you need forward-looking materially in results uncertainties are those statements a subject from All included number than to that are statements. call of of statements conference other and could to actual cause forward-looking differ facts risks these in historical this statements projected that These business risks in described press and affect other SEC. factors that and and in could adversely releases our our the are filings with future results our speak statements forward-looking All as X, of today, August XXXX. only of to otherwise. or statements, no new any obligation future assume We events update or a revise forward-looking information, result whether as to in press our on non-GAAP we financial A of earnings the included measures this is reconciliation are GAAP call release. providing

release measures and detailed As in results, including a GAAP earnings supplemental and financial note, are fully our and non-GAAP information operating our package.

these find as to conference the webcast website documents well can CEO, I over turn Singelyn. You our and the at this David on our will call replay call With SEC audio that, of reports www.americanhomesXrent.com. as

David Singelyn

Good XXXX Stephanie. welcome you, second call. and quarter Thank our earnings to morning conference

us like of Before and Diana Laing, our I was recent her I former begin to all departure wish I’d in CFO. partner dedicated a the acknowledge of future. the to Diana talented well and

and of opportunity take capital Rent, a to asset we company. years our Chris accumulate homes August step Lau Wednesday, of earlier household public professional as renting on celebrated that week class. And Chris new the promotion. transition. we launched American favor advantage patterns at assuring management well-deserved this portfolio have bring to and to attractive X, a up When fortunate X the are five a a CFO institutional We single-family recognized smooth Congratulations we unique prices, shifting as on Homes

housing we’re upgrade, only to but families tens of have maintain countless not homes, provided and rehabilitated past operate thousands rent. And here, in than years, I we ago us five say quality is realized. also homes homes acquire and honestly that I of lease, pioneering quality five single-family identified sit of opportunity we any the building these During larger we high the our thousands for years of as of Today, neighborhoods. can

significant for with and team with American have and owned I of am single-family Homes of proud front growth. committed provider results. housing accomplished positioned to the X X% continue in our sheet market opportunity lot rental exciting a a Rent and a sector fundamentals will America. But excellent only balance deeply We in of us the X% and remains as has long-term best-in-class potential institutionally

the tremendous from Now first the continued the results, second turning to a second momentum quarter quarter. quarter

both gains two continue to see in blended we compared occupancy days strongest We same occupied to our accomplished of last X%, the the total last And a of gains in while portfolio occupancy these average nearly rate years. spread rental achieving and strong home year.

moderated prudently the the operating season, the translating quarters several increases the favorable next our spreads And July, As we strong on rate in compared in through expect year. continue we based enter rental slower performance to into leasing to quarter. results late we prior

we communicated of our invest Deliveries every remains securitization in well fully up on homes recently high virtually processes Further by from remaining high to with strong allow approximately from augmented proceeds development over beyond. program, acquire Officer. is this our Now rental disposition. all increasing significant list lever. we from and mentioned is updated total XX early three our producing disposition cash growth program. have Jack and $XXX our recycling acquisitions Chief occupancy ramping results amendments are can flow, between to in we the our continue rental channels we of XX the In operating a proceeds of expect strong details ample have of that million free our we this as mature healthy, fundamentals and I million call. homes In single-family to Corrigan, for have positive. accretive our as continue our $XXX our the providing turning And We year sales capital, And To end, to platform fund steady homes at $XXX identified to portfolio earlier, credit through proceeds now expect outlook that for Jack activity, and have finance guidance. from expanded for and balance ample to months. provide Operating an are these substitution quarter including year now to program to growth development our to sheet will closing and for with be over rates. we our proven now exceptional. in collateral finalized call next to market recycle and future our turn plans second Single-family capacity which expanded economy systems programs the we and this demand later acquisition with I’ll To million are the previously the facility channels. the end is traditional undrawn of

John Corrigan

everyone. Thank you, Dave, and good morning,

that rate season. benefits our the our Dave in results exceptional, of steady investments the across of with front quarter leasing in second our earlier spring and entire As portfolio mentioned, see strength operating important highlighting We were had market rental growth demand a over base XX points same every month markets on increased by percentage to each and year including basis quarter home previously XX.X%. basis during occupancy our the improved occupied average last virtually lagged. We some

and even results leases new prior of monthly as to average X.X% was benefit in due the points we to strong better basis rent of than the our year sustainable. part in and expectations achieved in In with fewer last are from improvement with customer addition to the On we satisfaction to portfolio, quarter of demand, rental July be consistent in X.X%. rate through quarter moderated X.X% to second second slower X.XX% down maturation strong growth continue strong We of of improvements strong increases year. last move-outs front from blended XX lease a we intensely in achieved for these XX of continued quarter now points in realized X.X% average continues of years. we believe same-home leasing earlier We expect blended June and season fundamentals. compared We saw the basis spread the to market which spreads increases X.X% basis the

levels Moving previously experienced consistent elevated prior continued but to as quarter our expenses, June expenditure operating into and April on year. levels the overall first expenditure indicated in May with were during the

total the year, $X,XXX For of now of with per provide range our due lower compared home being related call. of repairs, growth $X,XXX to will X% of increase rather a operating cost these full the Much in maintenance, later guidance expect turn this we on repairs within proportion range. a the to to to by and expense largely fall turnover cost to property adjustments Chris which CapEx. is maintenance CapEx X% of and last more will details larger offset to expensed all year be than capitalized

Texas homes a this our X.X% Southeast, remaining With totaled the approximately Western of Turning for $XX primary total range. million $XX investment to million. of stabilized acquisitions, markets, for acquired channel with XXX traditional during on in we XXX included second acquisitions homes our the and focus quarter in yields approximately

of newly these constructed AMH of of delivery took markets were a our homes XXX and National were also homes Builder program. for from investment total We million. and $XX Development XXX XX XX from about

to latter we from are the our sizable we homes recycle currently development channel the pool. construction as further through Over of a traditional of from delivery number prudently half of capital under and our expect disposition channel year, supplement take that

now we invest closer to to from our XXXX, year $XXX full in total various million For channel. expect

properties of approximately XX Moving on sold proceeds. during XXX the we net second to for dispositions, million a quarter

as of leased. totals allow XX% another result of As all our homes. to a XXX At now sold currently These Dave to June portfolio homes added homes pool. we approximatelyX,XXX homes our we amended said, our securitizations substitution collateral. have disposition for are And be XX, of to

XXXX targeting on results look our based and in XX over summary, proceeds disposition next portfolio In XX are quarter XXXX. the second occupied second forward million now operating months. to half platform million and XXX tailwinds great highly a to into and I XXX in the of strong we We fundamental season had a continued to

the turn call Officer. Financial Chris will I over Chief Lau, our Now to

Christopher Lau

I’ll review a Jack. with Thanks results. begin off operating our of Starting quick

for capital second on $XXX.X $X.XX was XXXX an home second the unit million the to million per the share. was a $XXX of per Coupled quarter million second FFO $X.XX the to XX compares or portfolio unit million core XXXX $XX.X This the outstanding adjusted continued unchanged which attributable prior our accretive quarter share $XX.X FFO as the a for to last or second to growth to for and per compares and year. after partially higher our $X.XX is share of common and year. of last of million With net of the FFO On second quarter $XX shareholders in basis NOI of quarter same-home interest $XXX,XXX or share in quarter loss $XX.X Also X.X%. core share was quarter and XXXX, count. acquisitions $X.XX our or per per activity was net compared of by in share higher for The FFO expense same same second with XXXX unit attributable FFO quarter per the from expenditures for the was the performance $X.XX million to in same was offset for FFO regards operations, FFO loss portfolio increase to development XXXX which quarter core same-home XXXX over as XXXX. strong the months. operating Adjusted compares XXXX. in diluted quarter second of diluted $XX.X million share For

X.X% same-home by in increase capital a operating Our core driven growth in revenues decrease X.X% after was by recurring expenditures property core core expenses. the part in offset in in and NOI X% increase capital expenditures a

The pool Jack of this did reflects not note, removal properties impact previously. XX,XXX homes for we have now market for a removal and sales these pool our rolling five additional on metrics the on for homes same-home supplemental. identified as approximately of or discussed same always of operating the and a home performance XXX have of operating the of XX like quarter’s historical quarters a material As XX portfolio. composition performance pages But provided reference of current

capital our to market’s Turning balance and activity. sheet recent

was this converted us a great April into Series Class participating our €X.X balance all instrument in further financing capacity X% common we We announced million million improved C shares the the XX.X eliminated previously with believe sheet. for A it execution annual and As as shares. of preferred cost

from paid facility by Additionally, a rate off million capacity. our made we sheet a forward downs balance by homes sheet were while term strengthening and and in $XX.X our cash of down then paid ideal XXX reducing debt using we flexibility These million. going was which paid from secured cash in our the borrowing note of earnings balance further component June loan $XXX increasing May credit

at months five debt adjusted preferred to X.X plus net the EBITDA EBITDA for was metrics times. of trailing debt end improve, to quarter XX was and adjusted to Our the the shares continue times debt

and weighted with X.X% average We XX maturity weighted have years. interest average a rate term billion approximately a of $X.X over to debt of of

facility Our growth positioned from with well our expanded flow to million coupled revolving $XXX fully $XXX remains we undrawn disposition our cash objectives. recycle and our an program are credit approximately routine capital fund and million of

and for Coupled with year guidance as average color our Finally, Starting are to range. tightening XX.X guidance representing XX.X% of and X.X% our with like previously year now increased end first expectation expectation of upper also some communicated core six our our year fundamentals X.X% tremendous average activity months between with that X.XX% detailed the growth our provide X.X% days our you a for on of revenue I the same-home monthly through would the expectations, communicated range. our represents and previously to be the end are realized rent growth we occupied strong the to expect revisions which upper of full leasing continued XX of additional we to on between result our supplemental. demand full

strengthening result respect our expenses as property primarily successful to to Turning expectations from exceeding With expect our tax operational successful our management a occupancy savings full property growth expense X.X% and of earlier range X.X% full initial have been originally management our able for X.X% and tax are expectations growth property to in we X.X%. to to of efficiently now expense be to year overhead appeals than our expected of property lowered we’ve to the the manage year. for year

full-year previously, to larger property Jack proportion now mentioned $X,XXX last of than cost expensed range costs per $X,XXX R&M we As turnover CapEx year. the to expect to with compared these in of and capitalized being a be rather

to this growth we previous midpoint As expectations property operating expect tightening in X.X% year range full core growth the expense offset X.X% parts will be a to result , in consideration full-year to to into now respective affirming CapEx. after X.X%, the Taking X.XX%. we CapEx of are by all be NOI which our range recurring their X.XX% growth of in of lower core

now between G&A we to expect million we and In the end and revisions, million. which rate. And $XXX already of addition acquisition same-home million, $XX.X Jack near covered, guidance full-year to our has now $XX.X our communicated development expect volume represents finally be previously to to be full-year our as high

open questions. we will the call Operator? Now, to

Operator

the Juan with of Lynch. Sanabria [Operator line first your Please question. comes America/Merrill with question of proceed Instructions] Our from Bank

Juan Sanabria

just revenue I on could hoping time if range. same-store you revised spend little was the guidance

fundamentals Just you could decision takes put growth for and how this comment if demand. more of on any to you long-end seem into on you drove given particularly sense high-end moderate bullish the at versus and wanted point a what where to June, comfortable feel some rate and that the

John Corrigan

Jack is will answer I the question second first. Corrigan. This

of bullish are slow get want but last enter year. on we kind We did to a want - with the the to lot of we season demand, which don't leasing inventory, we

they kind do lot coming people retailers they and have of like but going Christmas because prices, don’t we Christmas. to start the So stores, of through they cutting a just before lot in have after want the inventory still

traditionally June about continue much So releasing X% that's we did bit slightly will I in done, little into in our don't last I year. think than months won't that have in a July, rates asking kind we last think did way the we and were to But slower are concessions fourth have much quarter better it we did on the like will to as we we year, of of what moderate in position we going increase better. year and probably reduce a we we last have in last maybe to July do we saw the of

Christopher Lau

kind on that this we occupancy then the roughly with second months pickup look of revised that's Juan, range XX.X, in more ended you X.X% look year that the it which how the call full can the XX balance little guidance. I Chris, our flattish for to and is XX.X% monthly starting And of indicates is so X.XX% And if based on of represents average to then days, quarter is the comment year, to midpoint being the add with or about you how a of a over to compares compares and about XX.X call X.X which rent occupied points that basis if year realized balance XX.XX year. XX.X% on at first it you six last maybe bit range in of that midpoint. we the to year the just we XX.X to that are that average On the our where think change growth,

midpoint as it together those two the to core range of guidance to the of of our and X.X%. gets revenues put You X.X% then

Juan Sanabria

expense, length spending on are expense. of now an CapEx the the life change the you just what's annual or on there and versus CapEx home What what view drove the capitalizing of any on just per pure spend on versus And guidance basis.

Christopher Lau

there saying in I spending. by is will we start real change that are what no fundamental is it

total both at expensed fall, As capitalized purposes and great for line will difficult you those what predict why for gets accounting the which both growth dollars NOI projection turn for that basis our line the and purposes, and dollars is door is it a to in focus CapEx how and of out guide of as management then terms of where we in know, more that’s quite a line. frankly combined R&M year well expenditure after net being going outset it's on we between on and the importantly accounting purposes, pretty pretty CapEx

but proportion compared our expensed And the of so those versus in you operating offsets what slightly range slightly far around wash basis growth, we expense coming higher be are purposes will impart is of core being that that part all so I CapEx CapEx are in this capitalized that growth actually property X.X% year after growth to of to in points. out year last pegging mentioned and see lesser the midpoint for same NOI then reflected comments of accounting our it dollars prepared XX bookings the as seeing we the our in the by

Juan Sanabria

quick [indiscernible] last like people is seeing, one in of one Raleigh, or just the year-over-year Any homes saw you anything then Greenville, occupancy I and Austin, some terms color. or from leaving Charlotte. in trends you are there dip me. of And could it provide rationale saw guys that buying a market

David Singelyn

occupancy think I'd reasonably all are those to up expect back to next that up. pick strong it I over three markets that six No, and the pick months

Operator

comes with line proceed question Please from Citi. question. [indiscernible] your of next Our the with

Unidentified Analyst

initial to there think XX.XX - why forward projection? reason the home to back next it XX.XX is capitalized going to expense run the back year or would is the a and going down rate is about per Just cost to rate go

David Singelyn

of what in good year. first the into second in consider did have the turn comparison quarter be so next have year quarter, probably and quarter we pretty costs the Well, may first would next I normal higher than

So don’t was going normal are up, will on, inflation, print going saw some we are know some seeing our of have X.X% if so you up. I wages unemployment vendors were we our the of

you’ll higher would be cost in some So, X% will some see by the quarter of offset normal somewhat than X% that the and to have. efficiencies and typically first inflation we

Unidentified Analyst

the then of yields, your Thanks. Program homes for in developed between delivered or developments, the And AMH you any Builder are overall yield and terms and those what's homes seeing demand on just difference homes? National

David Singelyn

the of deal yields couple depending better XX% a on the depending purchase The the X.X% we the homes good yields from markets but on is got demand acquiring how with I to think market both The something and delivered purchases. seeing high those to get the building newer and yields developers, the we really on land, with on be do are X% for are probably as that on vary we that will on has that from items traditional it’s on anywhere something strong homes closer the could yields we as do our them. and it and

Operator

question Our question. next from Evercore with line with Green the comes your ISI. of Please Jason proceed

Jason Green

to the might kind of and slowdown just how in on the in increase renting wanted word, June, to is circle be the wrong May back April and I but June year-over-year? compared

Christopher Lau

June and so, June of pretty kind rate I end it's a a than and year lot better - up this I if slightly is month slightly you you lower, July, of to [ph] relative to but The June really stuck. believe big was you're year. of June your with re-leasing comparable rate you the think into inventory tough blended mispriced because July, June have was a [turns] going chunk when last

be occupancy but a may too cut and the little have it rather keep we low, So, high. a I'd safe little

Jason Green

indicated kind brought stronger rented guess, you June, potentially like you April strength you make homes, answer there at, was and raised and down sure could occupancy, I there of those have right? May that that seems market. in real I'm it it some just of like It it to guys getting is but fill I some think, year-over-year in is, what and were seems and

Christopher Lau

two do and really as we've we basis, in same didn't same occupancy you decline move-outs the think pretty can the think beginning you Yes, you about The chunk first I it's May year-over-year absorption had positive really the not you're by you I every had June, and but occupancy, come years, right, keep XX we'll numbers but can, of home that's that's last them want June, same in rent your but at year turn homes, I to up for because with the to we to fast how year, and levels. by good. thing the want the on so June, of as place end a lot big as occupy comparable, fast this

David Singelyn

are year-over-year lines comparable. trend The very

spread the June. a each occurrence month is with So, rental just month project same, But we're moderation the rate year in XXXX, a during positive seeing the same each slight in XXXX. occurred about to last in

Jason Green

stabilization And kind with home seen willing more willing or of at the this get point? sellers have their you of then to portfolio just nationwide, the prices willing some in of of more marketplace, rid portfolio owners

David Singelyn

strong I we're are as such a really, things appreciation. as and price and cash strong well seeing, demand, most Not think really similar portfolio owners flow, seeing pretty that

not they're don't they know the get money to where they return. the if same put So - can

Operator

next Our Jade from Rahmani question. your KBW. Please proceed with comes of line the with question

Jade Rahmani

you is types Zillow, in the rental entrance environment. seeing any And, which for some hear new competitive in operating Just addition, competition the think you new in example? of Are are I seeing Atlanta, single-family about such want to from as space? any platforms,

David Singelyn

Yes, as basically far as flipping Zillow think, I mean, houses. goes, they're, I

and in taken didn't coming - supply I not know away were heard Atlanta, and to yet. they're out they've they I putting I get maybe - thought Phoenix, there's that Vegas they really but supply started in they're were big in did So Atlanta. they

same new to we seeing billion acquire seeing I $X see Tricon of older platforms at a of competitors. but saw we're about expanded venture expect the joint think and houses, don't I ones, competitors, other as far As just worth we're kind people and of.

Jade Rahmani

seniors such avenues additional housing? into ventures Are of exploring interested such you demographics, expanding in as, joint growth, new or any potentially guys as,

David Singelyn

well. And senior thing small rent it the in think. didn't We I XXXX, housing very didn't - did just a on it test

constantly we so, that. little and we Dave's And different of we've make another Both I questions are more we've to a the and - into announcement time. evaluated that's and foray that only and But those discussed I mean, at there's at I'm but continually number a the avenues markets being items, change are that areas. of launch think make looked hesitant will capital Chris', at then But the look seeing we if into an recently. bit and avenues, yes, of in little a not items raising your things of appropriate, capital it's raising are private equity demand

of aware we're So, that.

Jade Rahmani

could lastly, CapEx just And you in of the guidance? turn R&M give CapEx portion the

Christopher Lau

something out don't wanted we is of Well, for what I if on capitalized. purposes, it about you a But months this being that you six year-to-date XX%, the think basis, of to XX% took rough year, granularly. split expended that balancing seeing modeling the we're break if spend

best at guided of from the to And You which apply a said point. combined NOI after guidance can that advice start, that, be that percentage we why to my math our XX the basis is and at then it's I Page this supplemental. difficult very on would that predict get CapEx. like But

Operator

from comes St. question the next line Haendel of Our

Juste your questions. proceed Mizuho with with Please Securities.

Haendel St. Juste

yields single-family curious pretty how the completed of good, current developments pipeline, underwriting though, of development compare the activity? hearing. it or of could and about perhaps we've then inflation of yields So, rising degradation in on consistent, in rise looks a do have home thoughts yield those an your current cause I'm - that’s a there impact construction if may on, cost, pullback perhaps showing the the having recently been on be single-family and deals? an been a pretty some construction much underwriting and maybe activity your in how rethink And homes impact like cost in rental cost

David Singelyn

public the been are it rents. more going The moderating although are some so up, seems be to has costs the inflation there Yes, in recently. cost,

finding deals and like activity and development it's to buying the are much houses that is mean, on. were much lots close not, the quicker. not So, year The still to to we more and we're where traditional that - of versus two underwriting, back we good pretty quicker out activity I in intend yields pencil plan we build acquiring accelerate three it off, a cut one can hanging it's

Haendel St. Juste

there, Appreciate over I the How pruning the to be was gets the portfolio looking three perhaps next our and years. And $XXX other acquisitions the is to much comments on capital had into at of question assume two $XXX million million exiting markets? that dispositions versus thoughts redeployed to your certain should be maybe accelerate development, there some what color buyers, in interest is buyer potential see the any comment, do the we and current you and on yield see portfolio any medium spreads comment portfolio could if dispositions portfolio there any and market any interest then maybe but today?

David Singelyn

of pretty each easy Page properties markets. In Let you will in variety of are at at the Jack, point? sale the you we disposition held balance exiting It's XX is largest those to to by what number smallest the assorted one for the part. see top, were them a then Look the that at. supplement, first me take channels, of of. respect tell you're this seeing may looking be of markets and reasons for to that With our want offs

John Corrigan

Yes, I buyers. and sell then to occupied to mean them dispositions our try philosophy in then bulk basic on dispose unoccupied, the to they become to once is homes retail

of markets have relatively time definitely to doing most buyers, we're interest XX, Our successful from - but we've to that. But these XX, in deals smaller our take and We it's that exiting buyers, bulk XX, homes. been primarily percolate.

So, we're still on working them.

David Singelyn

is for a just Corpus about you'll see Christi, not are Chicago actual City, is towards list, of that's market or And Columbia, five market market the Haendel, Central assets Rae exit, reference, that out The Augusta, of Carolina. Oklahoma thing Valley, the the and specific market. exits, us line pruning that that credit so one exit, just top South our that

Haendel St. Juste

compares And X.X% where the then this blended I'm last have to July last rate but one, missed I July last I'm for what Thank it, might blended the year? growth curious you. year? sorry if was for

Christopher Lau

of year. compares last X.X%, of was X.X% which July this our to year

Operator

question of the with next proceed with Morgan comes Hill Stanley. line Our question. Richard Please from your

Ronald Kamdem

I to just little the Ronald color just If bit expense is a for Kamdem This guidance, same-store go here. Richard. could back clarity of and

going driven So cost are versus can I when the But that you actual appreciate much look rise the that out maybe versus expanse dollars basis of points how in capitalized. expansion is rise, being capitalized change items in help us at in increase is understand and XXX much how the I obviously by door?

Christopher Lau

the to Without exact you - its difficult number… give

Ronald Kamdem

high level? a it Is

Christopher Lau

close to fairly head. there those, because I me an those you just of let - to which takes two easy expense Yes, down and the is puts through other but you the all split guidance walk there off between top why way are equal just the components give can't of are my And probably weighted, revision. the

I is growth So, as X.XX. mentioned, revised X.XX property tax the range to on

internal two management HOA is you X, to grand and of at running on our of Property OpEx. to the small blend like the little they're is combined, washes with X look a Our you if items a and X those they're to of all combined. two for XX.XX way the so HOAs, two of those into a in CapEx And expense. large things. a six insurance core bit if proportion It's that the is being XX.XX line out higher, those, X it's to then scheme running on five

I that's it. in guess to to my point that X% more range. So, there pieces getting are X% to

Ronald Kamdem

strength the an there to just driving same-store board? any sort it and markets or and the - to out here outsized there Is maybe are of is the revenues. back that on then regions call or any across then upside And have impact -

David Singelyn

It's strength board. the pretty much across

Ronald Kamdem

on So of this feels the one my maybe product? something near get forward of the rental just the we in be acquisitions, right, or or run range, would a that of end is trying you're a coming based about on to to some for can high feels obviously demand sense, sort going the last same the rate the guidance think seeing just sort that built is of this

Christopher Lau

When lower. We've retained little that, you're some it It or more raise cash higher, I the $XXX program equity. on put having and next could a could disposition think than so slightly probably million that without of there year. pretty bit leverage of rate. good it's of this you be a and to year be run

looking what that's at. we're So, of kind

Operator

John comes Our Please of proceed your the question. with line from Green Advisors. Pawlowski Street next with question

John Pawlowski

active Chris, in or are Freddie conversations having you any a securitization? GSE with to Fannie doing

Christopher Lau

whole. existence and No, not in sure interest us a growing, the around aware, their the great are, them that as market debt of unsecured granular given them least how really commentary this active unsecured We're any just at manage at debut optimal know foreseeable of as and most of of kind structure feely yields for But and successfully to future, space. see the It's having in as portfolio we're probably assets out vehicle not. there in debt discussions I'm for debt some financing, the importantly their given the aware for particular, sector beginning We're about efficiency kind asset is for year of financing we potentially this that ability currently. completed need. bond the you're of to terms our it. great the of the is of and move for the flexibility us we us, And our the

David Singelyn

And into PPOs coupon are efficient for a it's to also for you the account term us the other favorable secured and when of more current costs, through, only not today. economics when take be unsecured rate origination costs on you that debt, us the but financing more and amortize to unsecured,

John Pawlowski

re-leasing And year conscious rate high demand homes in had previous and the single any supply and to XX markets, pool, of the Is within XX% there very of to turning to into say Page. digit to was this hot some these the under Page rented it of the push growth a some rate? fair decision of were management - and system on to same star that on harder push backdrop years? on these revenue within spreads of Outside the

David Singelyn

rents of push of and a second a limitation What things residential talking? created very, The of couple at very you enabled it's into in quarter. our occupancy little And On strong first these we going a the quarter, was page quarter us And the went are No, the to XX, what second top. bit in I strong think of market that very supply. the today on is Page then rentals. there's on. benefits many and for markets

John Pawlowski

So, market rent is growth XX%? in Phoenix now right

Christopher Lau

not that I probably say No, it's would high XX%, but singles. it's

We - philosophy is renewals. our have been not as push hard on

rate good number the a high for of it's and moving. calls quarter. than rate our our fourth in year also the the renewal And releasing so and a higher phone so, us And because releasing than be is time average to the push demand of people as rates probably will other on

which the to our not were get re-leasing. of XX is quarter, peak. we're peak - going is one pushing for yes, it We So, quarters on for rate XX.X% the second got This months.

David Singelyn

Keep the into seasonality John, business comes still mind, the in of play.

fourth but in stronger So, quarter. quarter they're are strong going strong to markets markets, second be than

So, is in to year, this the demand this for averages the projected be the is projected not it's - quarter. second

Operator

Credit comes Douglas with your proceed line Our question. Please with the next of Suisse. question from Harter

Douglas Harter

I during move-out Chris, in saying, declined quarter? did the hear prepared that remarks, had rates you your

Christopher Lau

I my in prepared that But didn't are remarks. you say correct.

if you you XX basis, that on same-store of a turnover look Page supplemental. So rate on the our at get

XX down for our rate that turnover quarter see basis You'll last to points this compared is year.

Douglas Harter

as can and longer? that belief, stay, is What the duration more you of your think push of of you average causes of do if kind

David Singelyn

lower. than years much One if four in move I - portfolio, there the is who and if look is of first maturation or contribute. a out at is percentage much our that three stay they higher it's Well, percentage that things years out few you of people I move that that a the mentioned the couple think

building So, we'll years portfolio keeps as longer stay, an because X% matures, average on think that of X% the stay see XX I itself.

So coming on group that's in and save us I them we've away notice if right place renewal then that implemented that to a figure service we they’re had group try them. And customer think can talk and part that for it. strong in very of to seeing we've to we the out moving, part contributes to of in-house gives years specialists three that react if somebody we're and back two it and surveys, it, is maintenance of our

think those of three things So combination really the I add.

Operator

Please comes The Dennis of the with & Associates. proceed from with line next question your McGill question. Zelman

Dennis McGill

deploy has communities guys first out market. its to there one product one things build you am been more? look wondering guess as the if if this maybe And just the that's to into program market getting trying at you does you despite you're and that are I strong opening all. of and experiencing do do run could I what next challenging initially year seeing to the demand that for at builders into gaining that of Would you year to what any below thought play more you

David Singelyn

delays inexperience experiencing myself mean we guys delays could we’re think see doing business is or I I our - as But we’ve this them fairly Yes, so result as new we’re worst as including aren’t it. got experienced first aren't a senior of be. guys we pushing

see. and we what type and thing that of permits the I in some seeing delays to we're there delays then see similar and So municipalities with think homebuilders

John Corrigan

no for little place of have does what new Dennis our is constraints vendors into each markets. growing the you I that on of in as just think product A of picture time getting Yes, is. go some for the we market when our deliver the that it we bit the demand product demand take big the some

jurisdiction little you construction a doesn’t have others we've of it’s residential there. but jurisdiction. delays matter you bit whether in more delay or markets than been that commercial, it a typical any industry couple a differences, see then has will efficient permitting And to been Some the there

one bit - many up permitting and of where issues. by for I of ramping we’re very But the most with and probably to-date track, program are. relatively comfortable so know little that been our delayed program And on our happy of the have was we a

David Singelyn

would further we like along to But be always.

Dennis McGill

to did just today held-for-sale I the to say period? over to be clarify of but be and what buckets and you these And catch that XXX didn’t X would side, have a on exactly X year disposition that you the proceeds numbers million XXX the would

David Singelyn

think that's correct. XXX Yes, but or it I was XXX

John Corrigan

to kind three be It the could may estimate is two handful that same and We and it about did look those years we ARPI still homes we in left. done we identified or We XXXX the X.X be kind of we now it's of at years. will most of pace. been have which XX what - of with expect

out is potential And and day for from we and One up a house one rent retirement. tenants wake can can that we proceeds of the from to that our you things as sell rental so till to company our you. company that naturally the need mom-and-pop then they say it another going to we retail. that under the vacates we put possible. rental and sell so investor if it do not house in they to We're Otherwise, will wait we’re it sell tell

Dennis McGill

we vacated the with so? time do turn have homes getting once essentially? vacated I is So what’s are am Right timeline they to the typical your them that and that getting

David Singelyn

listing you're It months six time it its depends year October, could if months. on in three probably summer be spring a in it November

Dennis McGill

one XXX one to a proceeds basis? direct of of to that comparison XXX the million XXX last And just that cost

Christopher Lau

disposition balance and our the sale held you is, off two of future sheet are balance for for the balance classified XXX the probably property get accounting aware on then the is the held-for-sale get sheet, as is It's kind you're there if terminology on There categories XXX the sale. sheet. they identify on of there

cost is would XXX. quarter. held-for-sale into held-for-sale So the expect you I identified the future there yet what but then move the in third that in that’s incremental see not basis is for it on sales And in

Dennis McGill

that? is much How

David Singelyn

are XXX sale, XX held look future see to you'll sales. the XXX majority homes for you Dennis for of at the are identified if XXXX Page

Christopher Lau

identified I and for applied bucket future Dennis of off for from but head the top the will held per number the it be know sale sales if exact use don’t to you the close. my property average it a pretty

Operator

your Gilbert line Our Please next proceed the of with you’re from Ryan comes question. question BTIG.

Ryan Gilbert

market over And June in So we've couple in in growth past and ability if your the the accelerate sale to impacted - developed seen July? I'm increase for homes wondering, of a that's raise months. in or rent rents? And regional

David Singelyn

all. at affected it’s believe don’t I

Ryan Gilbert

Okay.

David Singelyn

the think affordability lowering rates don't probably fact a people seen but up. going rates who we've I think properties. - of causing to but opposite dramatically if price and a of lowering maybe I not the increasing, of percentage moving Probably I know are in out buy a out move of what wages And also

all sure not blends am how I So together. it

Ryan Gilbert

growth the from acquisition moderate competition basis should end rent occupancy volume down points. growth turnover strategy to on the room second think to - XXX of at in occupancy over of Or and guess, period limited so XX available-for-sale, basis you've I half for And make rest rent about keep is of is your rent the in the blended growth point I the improvement got XXXX? the second over hitting how significant you're going year that's half? the up to the

David Singelyn

a the we’ll of just more year what demand your up make will because Well want had it to on last level turns, because lot last more leasing at growth year moderate it we releasing least be rent was but aggressive sure inventory. than

Ryan Gilbert

rent blended quarter and positive 'XX the XQ relative to of be spread will XQ you third So year? think that and last fourth the in

David Singelyn

Yes.

Operator

your that This participation. conference and Thank Q&A session with our today. concludes you you. our for Thank

now disconnect lines. your may You

American Homes 4 Rent (AMH) 3 Aug 182018 Q2 Earnings call transcript