Invitation Homes (INVH) 27 Oct 222022 Q3 Earnings call transcript

Company Profile

Participants

Scott McLaughlin	Vice President, Investor Relations
Dallas Tanner	President & Chief Executive Officer
Charles Young	Chief Operating Officer
Ernie Freedman	Chief Financial Officer
Derek Johnston	Deutsche Bank
Nicholas Joseph	Citi
Jeff Spector	Bank of America
Haendel St. Juste	Mizuho
Brad Heffern	RBC Capital Markets
Juan Sanabria	BMO Capital Markets
Adam Kramer	Morgan Stanley
Keegan Carl	Wolfe Research
Chandni Luthra	Goldman Sachs
Brian Spahn	Evercore ISI
Neil Malkin	Capital One
Jason Sabshon	KBW
Adam Hamilton	Credit Suisse
Dennis McGill	Zelman & Associates
Austin Wurschmidt	KeyBanc
Linda Tsai	Jefferies
Alan Peterson	Green Street
Anthony Powell	Barclays
Juan Sanabria	BMO Capital Markets
Jade Rahmani	KBW

Call transcript

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Operator

Greetings and welcome to the Invitation Homes Third Quarter 2022 Earnings Conference Call. [Operator Instructions] As a reminder this conference is being recorded. At this time, I would like to turn the conference over to Scott McLaughlin Vice President of Investor Relations. Please go ahead.

Scott McLaughlin

Good morning and welcome. Invitation Officer; Dallas Officer; Charles Freedman, Financial from and our and today Chief Executive Chief Young, Officer. here Homes Tanner, with President Ernie I'm Chief Operating

make earnings reference issued was after liquidity at during Relations We cause to other risks or results we market these available relating forward-looking our to third and make Invitation during may actual we financial measures section XXXX so. This is those yesterday subject we update Homes and differ SEC not do and the uncertainties certain this call supplemental could to in indicated non-GAAP capital We information. this results quarter does expressly report to obligation time During outcomes with the business future the and some statements www.invh.com. include are XXXX on such XX-K call. release describe statements on closed Form any of our call and document discuss of from also website other our Investor Certain may that forward-looking uncertainties statements. and of and annual the performance time. financial which filings statements materially nonhistorical and from resources may our in any statements disclaims risks to

the let reconciliations You measures earnings these that can regarding find Dallas. With most the turn me comparable GAAP to call information measures including non-GAAP yesterday's release. over additional in to

Dallas Tanner

growth X.X% appreciate Homes rate of same-store occupancy was solid Invitation a morning. lease with and Thanks It XX.X%. average Scott of quarter growth and everyone joining XX.X% I today. us of good NOI for blended

provided response we the a of caring premier Hurricane resident the high high couldn't remain scores Ian. by outstanding thanks and choice role we for as prouder members flexibility world business well associates. I housing quite while within service it. providing the believe continued and residents My past provide of occupancy live changed we positioned wake testament that turnover in resident those helping our quick of the especially in impacted has macro the quarter the team our need, well our them communities to bit as the and Our recently be year remains in efforts another the storm all we and in satisfaction to our country serve. succeed low of to Across a desire

of last month's have over this the average an in homeownership John savings out increased works by a leasing month interest difference contributes why. rates. of shortage a markets. thinking that in $XXX to from decline face According much Homes To year in many the XX% that data a Recent have housing units for Here's those rates term. mortgages of in from we pullback an supply million It's the helped lease since in in of start home. important a cost country homes solution housing Invitation average That is the due some a this this higher by also on across starts single-family Today's to leasing home. new to payments as still builders harder We XX% on States. accounts. as to roughly professionally haven't for the than higher near from part as last believe seen several start as managed are United monthly reports month's by the mortgage single-family of mortgage elevated Burns, further and noted for home from buying as

age well tailwinds as approach beginning further are value. average especially demand So, and our just fan leasing families to remains convenience a favorable advantages the who among preferred choice combining many demographics resident as of for millennials and These flexibility old. tandem with with will to capital. in experience. years XX this stay supply grow consider our our dynamics these favorable of and scale us expectation We industry-leading of With technology a cost our call there's that

Our billion the through updated approximately quarter of the acquired billion that we've target. year acquisition and $X full third is for $X.X assumption

our acquisition pace light slowed environment, capital advantage our current versus weighing assets to the taking recycle opportunities have ventures. cost We in of of balance sheet on and joint of our

available capital remain while arise. explore we're for As a expand at continuing when nimble operating accretive opportunities growth, and the result, prudent investment our to same to explore allocators opportunities all who to businesses management time may us as

energy our including continued have in-house practices, sustainability. our we with and of to energy deepened we experts We hiring learn address and recently our to two oversee the so ESG how bench grow our initiatives. best As and have many of

and responsibility the in task that force. great our pleased our to by latest these progress. We GRESB work reflects our significant I'm industry, areas us leader learned making a ESG note, among commitment a good increased particular a have a see to be we Of year-over-year, improvement over XX% and recently score

up, comment wrapping reported and to Before our I'd our on guidance. updated like results

before the the broader to And to the With in pass best, guidance debt committed to In to Property Our elevated I'll to REIT robust exceptions: Homes and brings positive the help address who us taking anticipated that, opportunities have prior business housing due Invitation doing to business our current options favorably expectations our year more pandemic, Charles, quickly, items. impacted is have been within property tax the two we our revised not price compared residents excited assessments full it's expected markets. we believe it for through overall our the for manage and this would we're space. somewhat and Operating Chief on and our And taxes within than believe is appreciation consistent we're closing, We're these positioned, to remains with by with rents. for the stakeholders. bad with Officer. are XXXX, to greater as home we our making, impact longer our bad stay residential the debt.

Charles Young

especially, of the in to to like commitment Carolinas our We're all following day. genuine residents proud of Hurricane I'd injuries and earning from thanking any avoided for our the to Dallas. have care Florida the by work our thankful their Ian. for of outstanding teams hard and associates you, I'm reported loyalty providing their service and storm. customer every begin Thank

Now, let's the details operating discuss of quarter our third results.

income. Our a same-store revenue and operating year-over-year. growth X.X% Same-store increase a X.X%, by grew driven monthly in core net average income X.X% in primarily rent, increase XX.X% other was

more same-store past have Our quarter reflects otherwise been occupancy the patterns seasonality from The quarter. to decrease years. for second third XX.X% expected return sequential was average normal that a the two absent the our

saw as in this third rate system the XXX year, Rental to elevated as basis basis points. debt XXX of been high factor points. The We bad as quarter basis a payments quarterly have been in XX to low that from return as points continue also has working programs down. the fluctuated portfolio to very We've role seeing and Overall, ground. residents to remains these to with in we common starting seek healthy. of many are who of volatility, wind and we'll solutions our proud our are help, need a

primarily pressures a quarter. resident rise to ratio XX.X% in increase by an to per household same-store over for in the increase expenses, Returning a the year-over-year, with Core $XXX,XXX increases are were a climbing pressure the not attributable number expenses -- operating inflationary X.X XX.X% income-to-rent of and X.X% turnover repair of expenses. expense move-outs rent. X.X% and of continued in a and residents, to New These in to improve fixed increase driven our current increased incomes times. who average maintenance year, results representing average continue their

technology our Our scale teams are where combat working can. pressures leverage our to hard and we to relationships, procurement these our

Next, leasing trends. I'll cover third quarter

New higher of than XXXX. or XX.X%. resulted in the lease basis points and rates renewal rates This third grew quarter XX.X% rent XXX blended growth XX.X% grew of

we're up on things that I'll end the of Given year, also the for shaping October. nearing are how touch

this of for We range. current and that mid-XX% and fundamentals. or XX% strong expect new told, at come November or single-family sent increases we in for are We X% believe come health renewal in out better, lease renewals increases month All the the December underscore at to the rate these in to better. growth

Looking with maintenance done we average how over bit experience. times improve the utilize ago, with ahead, and it's on mobile rating focused of the year resident app. we ways an We a launched app is, we've a example better now over in been lower can cost and app technology XXX,XXX this our to score remain Xs. One downloaded high

the our our bar who are videos, inflation XX% Once return our the reducing convenient call received proportion total Our result the executing a experience third the submitting a the proud now challenges hurricane, and Financial our quarter. have to of to call launch for for significant work residents rate a of that planning strong. Since the year These include on of submissions prior orders, a solid Chief more turn high requests today. need making are mobile high a and overall also and our photos lot I'll of we of laser-focused I'm one-third. by to to for residents. of the the maintenance by app, center, teams, year remain deliver nearly We app again, finish comps rose and trips reduced about Officer. over the through Ernie,

Ernie Freedman

sheet. with our fixed We our current no Thank I'll we in We've and with significant balance you, revised with weighted debt our due my also first, third average fixed, well balance following XX% at of XXXX. being of To third, for second, results sheet Charles. our Today, the our believe topic maturities guidance. the interest is environment. solid financial our debt rated positions discuss or unsecured. first of rate sheet; our as recap, I debt until X.X%, begin a to balance us laddering will approximately topics: our two-thirds quarter; navigate investment-grade the swapped debt made progress XXXX

is Our times. solidly of times six net to our range ratio now X.X debt-to-EBITDA target within X.X

our the our combination unrestricted $X.X of of undrawn and revolving billion through loan. nearly third end As term of on liquidity facility a the cash capacity and totaled credit quarter,

results. in This of core like third increase to now an rent topic, reported two $X.XX by FFO I'd Core our reconciliation to X.X% to NOI, Turning financial and per increased demand year-over-year growth quarter share, an for to my included following our strong $X.XX FFO the primarily increase per AFFO to items in homes. third our X.X% to second driven quarter share. drove due non-recurring FFO. out, year-over-year point in

our is financial first The of Hurricane impact estimated Ian.

net our the reconciliation losses for the experience, to over we it's million third months, coming and additional include casualty a in our prior on Based adjust estimated related our estimates. losses storm. will damages damage core FFO that needed, accrual identified $XX if quarter maybe and Our possible

recoverable the to business and limits. of flood portion small wind, for coverage insurance through a interruption, provide losses maybe and that our Additionally, subject policies deductibles

class alleged multistate and to item an regarding what faced fees. The is in claims have action similar asserted or still are allegations the global sector million XXXX residential non-recurring settlement a initially $X.X covers of facing. others May second settlement resident in approximate late of The involved

believe business cover interest core Settlement of will our Included case last I we and it settle details share. remains of save to release are any without do to settlement, While was same-store subject that in with the full not in year. the expense revised guidance which expectations results court updates, and in night's the best per order in time approval. admit the these reflect strongly updated for our AFFO last the allegations the we thing merit The were FFO we associated litigation. and for is to believe liability the and the to

we As Dallas Home due that to Historically, in seen current take might been increasing expectations assessors mentioned, to local very assessments assessments. have the expense offset XXXX. millage of values strong our and our rate core might real XXXX in of is operating partially be depreciation reflect for fair guidance and our longer revised taxes. same-store price change resets for has estate that their to much in impactful updated markets majority the

This final growth not based or now we yet in all real we about information our the will bills, estate X% X% Although, taxes us, XXXX to on received believe have tax for be to available expectations. in homes and our significantly increase and favorable bills XXX in primarily for higher due jurisdictions. basis to anticipated expectations other tax points partially offset is previous higher than assessments by Georgia, Florida

team in change appeal same-store when are to up bad when to assessments of were will years, from a XX% to their be elevated residents, clearly we not with marked and In between address and conclusion, We pre-pandemic to our year-to-date, year. take been on a compared to associates our We the solid timing supply-and-demand our questions. favorable With norms Less time-tested fundamentals Question-and-Answer and there proportion deliver We rebates growth. relative historical to and from as continue almost any rent. it that, for expectations in difference are performance appeal a with higher Assessments prior results. Session plan open we average prior are received. our knowing these dynamic much it's longer execute Georgia continues strong to to current and as please reduced that is now seasoned core operator, Florida for outlook expect platform overall business. remain believe and well impactful who the prepared revenue somewhat debt line

Operator

from question [Operator you. Deutsche first today Johnston Thank Bank. Please, ahead. Instructions] from go Our comes Derek

Derek Johnston

And measure sale? I'm homes Thank over the the supply supply listings you. available you the few Can change everyone. Hi, the MLS that tracking in for more the homes single-family what growth past and discuss in shrinkage of were on SFR growth for of looking of you months. number importantly Zillow? or So or is metric

Dallas Tanner

wholesale is kind this I quite by for taken mortgage -- markets of yet. more kind Derek, And part say, there. around new fairly obviously, of impacted out time price to highs. at not It's rates question. rates metrics the I to, are something that that that recent are most in We're Dallas. far Today, over being attention of paying we've fact think of mortgage good would looking and our bit as anything so it's seeing light and off appreciation in a acting some obviously, and home of cyclical, Hi, the that, of the have change a suggests behaving even maybe volatility the it's years spent

see it's had are matter some call this Homes new looking in Invitation In the drop has listings you mortgage sort fact, enough week where would to And makes in about seeing a go of the markets. it this offices country and you relative quite spent where you typically Vast some we year. today as favorable actually we're of people at resale And in our and debt time on in early, supply who time that funny majority out could mortgage think of to more sense, bit is. price. the country we it, the that at experts pretty a rates across, are currently start place

to to the just to supply had see opportunities been as that near-term hasn't been we'd So, case of buy the much in on as, resale that thus maybe the I terms think, headlines some additional start side, be able far.

of months it to when seeing less So late normal the bit listings Homes when Invitation a days majority at market, that's look far you're markets. year. in feels the But start XX the like, dive decline of and supply are cyclical of on you in kind than new down their doing little actual creep really

Operator

from comes Our next question ahead. Citi. Please, Joseph Nicholas from go

Nicholas Joseph

a acquisitions, business out market. at in of dislocation external growth, of, like born you. back on kind And housing I recognize, Thank the on Maybe just pulling least, it was you're seems currently. the

or are kind would what to mode? how leverage about JVs you large terms in see here? you dislocation for in reentering, you from acquisition to funding of as then, think so, you versus scale about do of what think looking on go that, And increasing need And

Dallas Tanner

Hi, Nick, Dallas. question. this is Great

kind and our I like feel of of acquisitions we where and think get on had product on is it, We we view going mid-Xs rates. in softening, the, we've parts prices but valuations in little there call -- of started if invest about say, it, feels Today being better towards back back going measured our call back be of sure time kind May, I it in fact said, what the setting talked of a like to normalized trying that the current that to and year. would seen we a part we'd the not what probably pull we to and like, level the to to to give call had kind cap bit the call -- approach that market today. profile. a was to markets of the of we to of the basis kind on pricing in typically in new of this terms feel wanted in That feel over in a return are those capital, much making our want we us X.XX of average terms like I a in kind risk-adjusted just could we're that think would bottom, where

the how time, have to about going we obviously portfolio we're grow the over of think use we JVs. As

extremely last expand And about businesses, about the liquidity isn't remarks. And years to certainly, it growth we prices have right cost opening REIT's the of when, as that talked would we're our we've not capital good the where accretive investment because now, as We Ernie the over equity thrilled at of couple obviously, hope that maybe about today. we'd management be. as times, at then, look the talked in our are need

said, partnerships invest. continue and what really ventures. So We'll fee would our I of, and meaningfully outperformance being and have been environment the partners quite generate those that as our use I are potential ways we'll JVs. call, And think, being to our through I we've to structures a as extremely good amount with find Nick, you business think, reliable looking management around mentioned, appealing. also, got at that joint We who

near measured, opportunities expand, opportunities are some So say, think, for term in allows cautiously, growth being external forward. to going but maybe to our for market for continue preparing we good what the to the relation I I'd actually ourselves in

Operator

from question of Please Bank America. Spector next Our of Jeff is ahead. go

Jeff Spector

real to you information on you process. guess, I first, said is can by estate the just … second, update. update in taxes it's you know If come describe that, based that When two if provided an market available morning. did I Ernie today on just clearly And the then the guys this surprised and light? parts September. Good okay, assessments. this

Ernie Freedman

Yeah.

Jeff Spector

guess, a can in feel for just or appeal seen historically past, in likelihood us success months? what you give just process Thank the in …I talk Georgia Florida, the or may coming you. about you've the normal happen the to

Ernie Freedman

Yeah. Jeff. Sure

until regards quarter to the is assessments components there's, real start do we assessment rate still tax two cases tax estate earliest in actually see bills weeks. one the most both next mid-October. The to Jeff here on is one in the is really -- Georgia. cases those the Florida the and out the to bill: come that at with third we to challenge some in key on some see final real seen rates views millage don't information We millage numbers We is millage won't this preliminary rates. point. in So see estate cases And taxes during few and the in haven't

do So picture we've of until assessments in past up different is some assessments end the and of the we have full the get don't millage rates understanding we the often rates full in things of challenge go in come October. But will towards millage terms seen that the when down.

judgment here about numbers. information as full we had And we we had fourth as that estate making in to out a clarity And real are where what we and may as why hence want and have be to do that's make our that's sure going. we So why September think tax we engaging bills adjustment on that be. quarter not the we with had before folks would final August the

as but in quarter do regards You'll that our the we reflected because With quick information it didn't Jeff. even months. as cases. have nine three have third today. to all it quarter, take really jurisdiction-by-jurisdiction, numbers other XX as third as in to see that numbers, some months appeals we they're the in our not many can six can to be varies In cases in It

plays states. a high a sense more it's especially we in be on optimistic results going XXXX. And will And they as We're success the We're have to them XXXX. opportunity good to that have into we'll past so may to appeal in the heading to for opportunity appeals rate there XXXX better we had will going the we've seeing And than small final that in really to won't out. for to on appeals. of ever we're past have as sense have have where well went have into we're take handful a And we'll assessments get see our an that early until those certainly two do in how just we're fight. that. that Most

Operator

St. Haendel Our next question is from

from Mizuho. Juste go ahead. Please

Haendel St. Juste

Good guys. out morning Hi there.

solid guidance better than delivered surprise. late quarter cutting But operating in the in multifamily. rents seen a a and in So obviously here bit we've was you stability very results in third of

what's us So understand I same-store going was bit a hoping under at reduction. least with on the more you could help revenue

get debt resolved. You bad few mentioned longer a times that taking is to

debt curious, it why focused taking become mostly particular region next is So do California? think into a And longer? can in year? And perhaps you Thanks. so a overall I'm is that bad much tailwind

Charles Young

the it’s Charles. for Haendel, question. Hi Thanks

just of and step back the kind me set Let environment. around context

in we two working purposely said, supported done the $XX back longer is over were them. through three California, XXXX secured today what the California is taking and to we've But been As to XX,XXX million the being of about what we're assistance. to seeing though alone, And seeing acceleration prior our over getting process Southern towards the the help helped Illinois, most has face QX in early and And that would knew on with the That down of residents time, area; But big good assistance rental part rental but be. state since -- The we've difficult same been we payment we we've NorCal, residents. your help the the -- times half rental plans states to the at support a process in secure varies would in of legally non-payers news residents we're is, assistance has able working normal see system. or And seeing are starting non-rental is to on in on in question, that have enforcement with Georgia. better XXXX, specifically collect also and faster at little it has flexible to taking are as that than they're residents lease the and of that it and process that. closer back by to what that we're thousands however that were we it terms -- the year, kind of pandemic a typical assistance hardship conscious like. our thought the focused could. in gotten acceleration where we come being residents talked slow need rent was in our very we of our we And the that recognizing calls up incentive of on that they up step perverse that systems show pay the to waiting them now. they rental were to And --

some So rental L.A. assistance across are And kind where through off more biggest delay markets that's L.A. before being normal slowdown process. -- of and it the we of City as of move with this we've saw the kind is. slower about but in biggest to go legal is the board the the County of and well to the California the the talked able

a next So be little few a the as transition it's bit we're it to going it through work through we just and moving over of quarters.

Operator

Markets. is Please RBC question at Capital go from next Our ahead. Heffern Brad

Brad Heffern

follow-up a Ernie everyone. morning, Good Thanks. the taxes. property on Hey.

of, property should through. some, the expect XXXX you're expense giving see XXXX Obviously, when three of I'm get not have So curious tax this But sort sort to typically teens guidance. operating quarter level few one them more you we increased through? as as of first quarters flows flows you expense in growth elevated of it

Ernie Freedman

clarify asking so can opposite. be to It's No. Actually the that you're we Brad I'm going glad it.

didn't to quarters three do we of accrue have catch-up the We XXXX. a in first enough because

So it's real we we're in all the information increase, elevated hindsight the going here under upped accrued very the fourth growth because in were rate because we for without having to have to but us. quarter a available estate taxes

year-over-year going see we some But to our had fourth elevated as you're it would level here we've same see in because And then as here level comp you're a in about quarter. a in things the the played fourth of growth year. elevated a the slightly see the fourth first comps higher you'll seeing of quarter, at you'll reset think So out shouldn't an -- the be then course, the part same. it easier that But the quarter. at be very

Operator

is Juan ahead. Sanabria Please question from from Capital BMO Markets. go Our next

Juan Sanabria

Hi.

there Just the to some And for-sale supply being regards space or occupancy moved of What's earlier Is an rate the speak rental? going in it's that single-try impacting, geography-wise? coming going maybe with you for anything question back is that's rental whether shadow across that? with back to kind or to and that a of different portfolio the product could on to churn market. to your

Dallas Tanner

roughly I XX.X% back at rate growth this Juan no. at from our being think I'd we're the Actually look you went at pre-pandemic X.X%. third the at we say quarter sort of opposite. things quarter like called and XXXX All equal numbers if looked I think of blended

of demand that and still and appreciating in it we're balance call demand product. seeing amount of the home accelerated So price the appreciation for between

kind mid XXs. Our of the occupancy in elevated still

as the run in last so historical demand business would of that about typically actually on a year we're than this see for that we basis or XX think years And a over the time year. seeing we kind more normal of you the XX

so. I wouldn't say So

other probably are marketplace. out are digesting and new there to have are certainly that there Now operators it product the as comes -- that

our suggest more of anything that on any to or numbers we're leases. But ability and see maybe having of change some as little seeing would speak might we're funnel Belt that your in you not additional Charles bit well of markets a in our And supply. top to Sun execute to this

tends slower Now leasing to in part be year a all perspective. year this of normal the things from a being equal the

as is what get the that where So leasing pandemic velocity the of our year and the call it always good it into I two generally year. would lowest that the January quarter kind have of call you had of early that outside perspective to keep last is we have XXXX

kind more little two of winter normal have a fall seeing so last we those -- that behaved this into are year. as probably what not as bit So the months

any It's seeing more continue the day any maximize not inflationary we're pressures to within of business the efficiencies at concern. really just that's So causing of cost us about of supply fight end front can the platform. and kind we the our execute the how

Operator

Our Kramer Adam Morgan from go at next Stanley. Please question ahead. comes

Adam Kramer

it. Appreciate Hi, guys.

less want Just that but than kind clearly bad in rental been have quarter, of quarters. impacts Look recognize debt. there to about kind assistance of may ask the some prior

from in quantify then pre-COVID due from So And just process a of How there? that maybe kind we the wondering kind just chance there to XXX debt relative get points kind of back to take? structurally bps kind kind could never kind of basis we received to maybe recognizing systems of or of is changes bps to to rental maybe the can long the here getting basis was the of that kind XX points? pre-COVID to what's of the quarter. in that bad XX regulatory that XX XX of if normal you quarter bps And

Ernie Freedman

here how go about to quarter the with debt. Charles, me third through from of bad impact we part I'll first think the regards over and walk a Let second turn assistance, the of to we off it with dropped Adam little quarter. that's bit to rental question where how next the

$XX rent $X went million the for from us quarter, So million to $XX we to second drop from saw payments up million. million assistance to debt quarter. quarter quarter third second $X Bad from the the by third

talked getting People get back only people we're them if understand in bad one are terms $X what of assistance, $X be to that's And more to So, lose debt It's to we anymore. I'd and would up keeping rent going going because -- Charles $X up current what are they isn't thought might available that rent million rents. million, starting for have of about. saw on have assistance, their been that say, of with pre-pandemic million.

quarter then gone into similar rent maybe in bit a much expect to the a fact, So couple going we've a for of we away but of had quarters, of and on we're there. terms likely continue may counting we all. that last see not be seen first little little trickles we've of XXXX, behavior the thing, better fade type off up would there at be assistance dropoff a forward But very and for bit drop as making -- it the you where people

Charles Young

Yes.

A As we were understanding our we've back on little waiting of been And the will question, it I showing is to rental earlier and continue paying. we'll as rental see really assistance, as and execute do push. them a as supporting residents Ernie be And of lot continue that mentioned, work we'll through continue year, eventually. to were assistance improvement away. getting and that period and assistance in all to normal normal tightening to bit how we're how we improvement we to flexibility of to to a recognize it in said effect good enforce that the the are lease. going partial stuff, residents the to that of residents, while seen before. where that going transition psychology The the rental terms just wanes going we've which we just with back we we're at just we're starting to back I payments are do like way we're the while And said, and this

Operator

is Research. go Wolfe at Keegan Carl question next from ahead. Please The

Keegan Carl

Thanks some for clarify time. guys. Hi, Maybe, just wanted the things. to

compare of pre-pandemic this to annual? rather Just kind are of percentage And your curious than does levels? leases what month-to-month how

Charles Young

Yes.

we're month-to-month on X% about to So side, at the X%

Ernie Freedman

Yes.

Charles Young

Other California the that or happening lease. are the is any number. we see of because X% renewals. are that, the And The the change terms than the where leases. the CPI numbers a plus other just close to seen California really of a are each numbers we on new increasing haven't renewal doing month-to-month really of majority in to

And rates. go retention any just month-to-month. just itself. in sometimes, choose the renewal seeing month-to-month We're terms change to they of, It's not or around

Operator

go Please ahead. is Chandni Goldman question next Our from Sachs. from Luthra

Chandni Luthra

for question. taking my Thank Hi. you

laid taxes those going maintenance so should think within you items, guys into So about we expenses other but next insurance items out repair utilities, line all and year, please? line for XXXX, how of

Ernie Freedman

on pretty taxes quarter around clear, is like just real question Chandni, basis. be with year-over-year happened look the a things here with To this the may Yes. what specific Ernie. what's and fourth estate was comp XXXX, to real didn't for would XXXX I overall items. guidance we want taxes any And at what make for the time providing not guidance estate very provide thought be. any Chandni, clear, we this we're

So unfortunately, to that. we're the answer not decline

Operator

Our next question is from Brian Spahn from Evercore ISI. Please go ahead.

Brian Spahn

this in today earn-in the then that just where you like loss the is I And your today? next missed Thanks. at given activity expectations lease portfolio also, and for looks might the just capturing talk what year-to-date? the year have about, could of Hi, but

Ernie Freedman

right stand where rents you lease think the terms were where be X% of year be earn-in to around our look what almost through a the is just it currently we at is the of out the point in tracking where where just X%, terms right remainder to market for And XX%, to rents relative Loss a if were and at of this end are. we perspective. rate Yes. right now in hair year, average at under rents is will our from year, just of

growth to course, think revenue debt picture well excuse to bad have have for occupancy what get is rental a we'll Of we to fuller consideration as growth, year, or next rates in going me. to as take with

Operator

from Our One. is Please ahead. next question Malkin Neil from Capital go

Neil Malkin

question you two-parter. A morning. Good Thanks. homebuilding I the side. guess, on it's say a could

market potentially just or you more what's acquisition dedicating kind sentiment, pipeline more of then just give -- of applications growth homebuilder buying you are First, your kind yourself to homebuilder capital buying those you regional kind priorities? what are about thought assets homebuilder mortgage in when getting through seeing homes of allocation of advantageous? the an calls, And isn't the embedded a Are relationships? secondly, reduction momentum given inbound and toward the and

Dallas Tanner

Hi. that opportunities This is there. certainly come out stay a would us of homebuilders. chatter Yes, want vis-à-vis There's lot Dallas. to we to with definitely opportunistic any

what inventory of call active lot and it's a of I'm their it, with I phone future stages are calls the pipelines we've sort phone to now, same It's homebuilders safe of think thinking are a of the getting early say, our calls. assuming right lot and and peers things gotten that. like

desire doesn't and a to the think marketplace. having of extremely stay large seem our downside structures put happen further from to over really that long-haul place continue that will terms infill buy change strategy risk call I it the us, protect in opportunities in accretive in that could

I pretty kind in feel it's of out. some of terms So, of shaking where still this is like early

They've some and of call it things done tool just like in sitting belt builders trying got think buying the that. tools have move I'm rates job of their their conversations inventory. current some around nice mortgage what to on I of also hearing a from kind down

Also, of buying lot a of rate. the kind get taken imagine that. I inventory some of care of ourselves, operators, done selling like the to sites scattered can near-term down through of use So, we obviously, have

the over couple picked years, up couple a think I last way. of hundred homes of that we've

in going we're to thesis. It's our So, to it. continue part of invest

partners next partners we lean say We the that and have be moment not for us view only over should year two maybe the we XXXX partners. this in road. very partner with would And other opportunistic able our Pulte homes we're in to over future our a with good pipeline doing current down but a and as be where or

seen point, this we've So, before. advantage once from our

While see backwards like did XXXX. housing my and current not in belief is move we XXXX to going that we're

will time meaningful industry-leading what I scale call Invitation to I investments it be add could think to for make performance. additional over a and Homes that our would already, great opportunity

viewing for growth. couple great the a years as next, So, it, a opportunity of call we're

Operator

comes Our next from Rahmani go Jade KBW. ahead. from Please question

Jason Sabshon

substitute lot sector And for Hi. slowing about speaking behave the driven multifamily by view on multi? rental slowdown This a Sabshon, product expect chatter similarly? housing single-family Jade. you to do you Do of is actually demand behalf But a there's of Jason in formation. a as

Dallas Tanner

would short answer is, in be resilient pretty SFR expect a The we to downcycle.

we tremendous quite last We had frankly exhibited years the during the that think XXXX. over in X.X pandemic. I performance

to same of keep mind. exactly that, couple One, the to the in addition a isn't customer things In you got customer.

if operate from similarly, While balance at sheet different. very P&L our you a perspective, businesses or a are customers them typically look

product. is single-family square has opportunity of per lastly, a with it's I The And foot a single-family basis other for-rent on that then add advantage typically would an much more in that efficient also rent square footage better for call or may is provide of how matter your buck. my investing use a I looking have dollars, are where at to greatest going it, kind of bang SFR people can

loss Ernie hold least around some the supply. our up limitations that overall expect well business at about any and would to given pretty we of talked embedded So, the downcycle of the

we country. take a a this enough don't and step in to in these housing have also basis, remember, fundamental You back have moments on units

you portfolio demographic X.X household if that's growth to where have are average. still almost formation times Specifically, going and you we're at US look our and lined the up,

for So XX, of in into we business lot and medium-term between earlier XX now. then, our cohort talked that our and of XX call just would expect a are we the coming And people ages about say of right millennial product. demand near our it million

should that So, natural actually feed would in what the proposition. tailwinds I terms call we're of, bullish quite into value SFR

Operator

Credit Our at next ahead. Please Adam Suisse. from go Hamilton is question

Adam Hamilton

appreciate and color Thanks of in just terms the I the debt the really housing spoke tailwinds. all time. tailwinds the gentlemen. you around what morning, Good for your bad about

concentration maybe, and could Thanks. geographical if are around provide, So bad some of going with not forward. any whether I associated you wondering some was debt the price or that that guys seeing of you sensitivity specifics

Charles Young

Yes. This Thanks the Charles. for is question.

kind it's XXX days. California assistance, XX where XXX As have seeing to we're XXX the days; That's mentioned, the as taking Southern days. in to historically rental in might been it California. in XXX geographically, slowdown is I the California, it's slowdown XX, over as the NorCal, where Southern well court specifically both of systems,

non-payers a XX surprisingly The be markets its of -- this isn't days. it's bit the to Georgia, days-plus. little residents, move is through change days it And necessarily we're in are -- quick again, used behavior around very seeing other to XXX of to be process but used that a the XXX Vegas it's where

we and L.A. this. -- So even year of to you're have going City able through then we up L.A. where -- when file. to and next we're as not That's work some County still show

question getting the month-to-month. the California month-to-month. go are rental But I'll in a that just Keegan the number. legal tail assistance enforcement, again, step as a we the slow X.X% deal the around markets work with asked bit markets on through all responding to I they're of be and the seeing and earlier we back as down. about there residents We're going we're there's as So this. one away overstated little

So we I to number sure just precise. make got the want

Operator

Please, question from next ahead. Our is at go Associates. Zelman & McGill Dennis

Dennis McGill

beyond Hi. for property Good bit growth through something you could back we If pretty expense walk guys. taxes? morning. Thanks, a guidance more for little full Ernie into the maybe just at year third look show like notable other have something would you to were from were some fourth well where in wrong. the elevated, which seems already it quarter, as unless acceleration doing categories quarter, I'm

Ernie Freedman

at are Charles rent, more in we the on be with -- when about having Yes. success be who No, with someone terms. is, as issue inflationary the out. the bigger But on year. dealing and tend would comes last to to have maintenance churns call I higher talked expensive also turnover we as paying Dennis, those continue some out, aren't we residents maybe With regards repairs with pressures and both to churn, turnover than do slightly expect to

driving, absolutely So repairs mainly certainly year, we you some But to we interpolate the trying a right. us well of you're our we've to the happen but those that estate to taxes, board. estate based number going churn. seen what all more the take think driven you're well because When are looks cost of on are what as because pressures a what's is other continue been cost as per challenging real guidance look well churn up pressures see at And for quarter across expect real continued year average that. to going also little got you a taxes, bit as and is the It's really with what of fourth like, as on issues. highest our the by categories maintenance

Operator

Our from ahead. go KeyBanc. next from Austin question is Wurschmidt Please,

Austin Wurschmidt

you the Can to to between how how lease average market. then, referenced you believe I loss And said versus Great. home us just to rent XX%. morning. lease call calculation? a you that your calculate in remind prices the Dallas, in earlier Thanks. guys changes own XX% and difference loss think impact the you Good cost I on is

can just about talk those you variables? So various interplay of the

Ernie Freedman

from they Austin, directly I really value how you, pricing cost renting would perspective. relate the and isn't our you necessarily it home market rent The cost the pricing relative -- us leases don't tell for We're get from our what works to with do the what mechanism a Yes. of pricing to price how based bear. the regards on leases. we price to will

market each because -- It's entire our due to month month good with very to entire calculate and the market an of from is a is necessarily as say repriced. weighted do up of about what a and versus don't and that's very is are lease to across more our portfolio think estimated homogeneous a our market And system. it for where calculate of proxy XX% loss think which then renting tie to buying we're house our We markets. today. going and portfolio lease. renting use running average our that but basis we proxy portfolio things, through really loss with we market we -- a to two in come rent management it's our metric They're on again, our that how rents then, distinct in affordability that take that into not And And revenue put entire what to price, lease we today what's product each we house go less. have sometimes portfolio, the bears different. XX,XXX sometimes each the and how We bears is to the Specific homes understand we coming we a perspective. pretty new renewal and you price between XX%, is then anywhere X% a

Operator

Our next Please, go Tsai ahead. question is from Jefferies. from Linda

Linda Tsai

across slowing, of do the your homes your Hi. the of concern economy different rents to rents market extent markets? have To there's you a the single-family compare how sense over

Ernie Freedman

market. to price We

are consistent broad of we the we're of to where rentals we're there market -- market have at have out terms the the try higher that in of across and But income a we're think we're for when at most each feel a affordability average little homes bit we're generally it But the we importantly good earners same bit We metrics average little to have general are better of think to space. that professionally terms coming ratios. our pretty a I look in having companies across Where in because spot like think we're pretty income-to-rent in think where types that's board at the especially market. at kind those. also they're their space our in rental in two I X:X, on $XXXXXX the almost we a we I So in rental And of other homes. very end we're size for requirements we managed. X.X -- of do of much in we you homes wage minimum very relative think

Operator

Alan Street. Our Please next question is Green from go Peterson at ahead.

Alan Peterson

Hi, offering concessions that we on markets. for noticed everyone. in the time. select Charles, your now Thanks website you're

here, Just use or concession on occupancy to Is usage. decline the based them? the to that use continue weren't is view on could build this decision to from a if up you concessions question occupancy meant to

Charles Young

seeing the to XX.X% of last the wasn't that -- years. we ended as market QX We Look question. QX great that really mentioned the No it's we're seasonality know strong. Yes. couple there that Dallas return

a typical the as push is holidays. this go we so, for And it's and QX into

is and before amazing. select or renewals is growth So at to which demand with secure rate seeing for strength this the We're that and rent just limited concessions a -- rent healthy strong. as push the it gave XX%-plus really we're time keep Thanksgiving good that we of of healthy homes sure I really Blended occupancy running the make on a the numbers are year with growth you.

really into up and then occupied we period us this as making as So go we just sure well highly set high is the can XXXX. slow for

Operator

Powell Barclays. Please is question from Anthony next from go Our ahead.

Anthony Powell

may be Hi. current weren't issues finding the due delinquent guess tenants I given newly the that wanted who that bad I to some A was quick versus it question confirm debt. on paying all economy? COVID-era to tenants

Charles Young

COVID you working But lot end growing of through historical a are that again new. enforcement courts. of those there process the lease. slower. courts that creating again, the going is the are we're of kind number that If debt through we're And new our The is are somebody that bad the up with isn't who's --

a there's California talked of mixed bag as in So a Southern on big really based California -- the little historical residents the a are there. numbers we've But lot of about. bit the

Operator

Our go next question is Capital BMO from Juan Sanabria from Markets. Please ahead.

Juan Sanabria

today's you're the wanted taking out just I other up once the the a that Hi. them and of on the follow the the mechanics debt higher how to preset we homebuilders in pricing give environment? think you relationship completion. product about ahead should Pulte of of relationship to the upon kind changing go takeout given cost Is build on and or cost price capital where with

Dallas Tanner

another limit discussion ability another we of both meaning down a basically then more decide and follow. range is we could -- of look If any on them market pretty that on have Well, the if beyond discussion. time given there's or we they on we less walk away. sides have we the think have to are a structure there, generally basically at kind so costs then come pricing and some have easy changes callers We with there's where creep a And we or there protect cost execute them. to to project savings certain us we speaking

would large along these tend of upfront. limited projects inflight And earnest way. we're well money protected call pretty So updates to be with and the by pretty I what a lot with

And have that so in have can So take market callers structures call as time, it protect then dynamics well. us. periods we of different both tranches longer come over general have we -- those Pulte that to we and deliveries into

perspective. relate obviously generally at the year from markets or we all it overall to over also And time I the at opportunities, think volatility price looking as going go could new So it as to and very more call forward how could I look next structure two. favorable just we're say we a spend

good to is not that be wide be to make it eyes are current opportunities on to going future. or call either but great the only open everybody's that favorable locations new market, locking at pricing assets, we sure we'll conditions that in So

So question. Juan I your answered that hope

Operator

ahead. KBW. Our from Please comes final question from Jade go Rahmani

Jade Rahmani

wanted just follow-up I Hi. to quickly.

be in the In the single-family lease are otherwise purchase is home? home impact of other looking demand, material applications at to directly shortfall notable from new demand rental you who is So a seeing words, buy benefiting people not would or this point? percentage

Dallas Tanner

No.

of funnel felt consistent has around that call lines pretty our top And see in years in time up normal year. type customer we terms today. into Our of with this the coming it the business of it generally things of would

that home the decelerating, said one was to rental in single-family pressure a the to the our wholesale market amount the of home also now listings think on rates going we're side both in our what owning existing and coming We're new the and That Now cost higher capture would in in to for year this that important today the a how of near-term. on I early tremendous could and obviously existing could prices than supply should XX% the which of being are put to we're suggesting in is earlier inbound that's one it of that we're changes being that's right emphasize, I argue business windfall suggesting outside of maybe where that's a think impact marketplace, have said assume. anything anything because we not demand into supply. net not seeing if in it's seeing support mortgage space mean housing January

keep overall landscape updated early we'll being thoughts view of pretty are impact. everybody our it's forward. of realistic but in quite still we're Q&A we go where we the obviously that favorable, on also mortgage End rates providing But terms So as as

Operator

hand the the call Q&A I to This Dallas. session. back concludes will

Dallas Tanner

to everyone at appreciate seeing look We participation upcoming today. Thanks. everyone's conferences. We forward

Operator

conference all call. you Thank joining for today's

now may your disconnect lines. You

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