INVH - Earnings call transcript Q2 2024

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Operator

Greetings, and welcome to the Invitation Homes Second Quarter 2024 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, Senior Vice President of Investor Relations. Please go ahead.

Scott McLaughlin

Good morning, and welcome.

Scott Invitation Young, Dallas Officer; President Chief Officer; from Executive our John today Officer. Financial Charles Investment Officer; and and here Homes Tanner, with Chief Olsen, I'm Chief Eisen, Chief Operating

Following question. our question-and-answer our you time, sell-side you'd covering then please of to conduct limit In a interest X ask like session requeue question the and with analysts. we remarks, prepared we'll a that follow-up yourselves ask to if

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

financial discuss call. We non-GAAP certain this during also may measures

GAAP reconciliations measures including non-GAAP comparable additional in most can information release. find You these the measures, regarding yesterday's earnings to

Chief Tanner, over to I'll that, the now Officer. With our Executive Dallas turn call

Dallas Tanner

good everyone. morning, Thanks, and Scott,

the halfway and We're through results the with year, a posted to little date. we've pleased we're over

average same-store over continue years. of with stay residents to stay X longer length Our

core the for XX.X% FFO And Our year-to-date through with with occupancy second with performance financial remains June the during same-store effectively full our of average pleased up X.X%. quarter. portfolio we're

We challenges officials It's both and policymakers so elective of have encourage and to to housing Burns team latest again therefore is closely. by off focus their long-lasting solutions work this his the facts the Like great like can housing many year understanding today's election once be a reviewing John and the some others, and to on effective follow that complete an aisle. I'd sides of of housing a we start enacted. morning data. of

are X.X% the the United other a their There those XXX last About during own roughly something. States rental home, This roughly just lease, means while apartment, total XX% homes Of for years. historical about the own across wholly average And who X above XX those in the owned is that million rent our supply. single-family portfolio, home. single-family accounting lease of XX% lease million a rental the are with there households today. an country rate XX% single-family XX% of

I'd Against remarks on that prepared to backdrop, like X my topics during focus today.

that we access and home additional a been millions about the to great include flexibility for of spaces, time as today. and than believe has as a compelling schools. reasons there choose We've the desire more These spoken a traditional to First, privacy lease. lot Americans well to never convenience lease

of have In past those, between leasing. opened cost and addition homeownership years the the to unprecedented gap X an affordability

Chief to of expensive was among to month it According cost under nearly of more to according just Today, many more X a than our markets. to lease a them on data, the homeownership it homeownership buy $X,XXX to lease. has than average cost expensive is $XXX Burns month High the is in of years the ago, causes. and housing our is supply of new leasing we property a costs in in to taxes, value with among steady housing insurance and homeowners' the lack Add homeownership, other becomes estimate proposition shortage experts even the is more Various millions that attractive. of home economists of units. nation's most supply. believe us increases the

So imperative homebuilders the if homes to that address more meet growing build demand. affordability we that to these continue challenges, to it's were

my second point, is to to communities. part to proud homebuilders partnering solution we're be by the leads build That which that new with of

We within continue in our of markets. well some America our to homebuilders as regional partnerships the as expand with largest homebuilders with focused

those can looking communities Our larger or partners our by communities and lease America the next in they understand XXX delivered diverse they million More everyone for win growth, might is faster more have homes their otherwise home. are who to build including alone. households faster that appetite supported than a for and finish buy

our lease Our addition added X,XXX newly to in plan over homes includes the around since years In that make already homes nearly constructed current homes for available few next to we total, we've the new pipeline that's or X,XXX X,XXX that in nearly XXXX. built Furthermore, and the our are yield of on-balance sheet being at we X leading X% of just most our opportunities efforts costs current with cost, attractive pipeline a or since better development. launched risks industry the on years underwritten mitigating returns ago. while build-to-rent

ago final that differentiate doing our XX/X residents industry. a make compared believe we remain by and offerings this the right is the right the In point worry-free by we service pioneered way stakeholders. care majority provide lifestyle of professional small all up to and to standards several who our means our service genuine third doing unrivaled. particular, our landlords ProCare's as We years of My vast that

largest orientation points have received to our this We a our are drive third-party XX-day most our their exclusive overall care our in of the performed that these point, recently of this touch customer helps strong customer and of the management and also service for part a portfolio to visit. teams by brand approach in more It's business homes homes resident June why with premove-in some level highlight nearly person residents. all To move-in Both through of associates. their size as owners post and resident market residents, well XX,XXX for occupancy, and scale retention than turned to growing our year-to-date, as is our released resident-centric feasible our whom respected and and satisfaction. new chosen believe

the We communities. the greater also leverage more our X scale good recent of examples. call I'll and size for the out

Red support is Cross, more their specifically, the of our Alarm safety First American and program. and Sound fire the home

families Our Red smoke fire Cross the helps sponsorship home install educate alarms and free plans safety. fire and escape on

in spaces support continue Beach, in X through Florida, and we California. outdoor new Dania to This green brands: Community Secondly, Center improvement the Wellspring spring, our we Garden local past of and programming. spaces the PATCH community development funded Sacramento, Women's

a communities, impact take to we in where pride our empowering long-term they neighbor and our local and supporter live great work. a associates they of where As make an

thank proudly for their and all our stand their to of To wrap earn up, thank trust that our associates behind who trust. I'd to loyalty day residents and every We work like hard company of we're our a today's doing honored work to a solution the housing associates to residents our be that the challenges. our have with us. part ensure and are to And great experience

fraction million where so to a of do of choose individuals remain we who premier a we us, lease can and home choice Americans just While thrive. with families the the believe XX X%

on Chief call the Operating Charles President to Officer. pass now Young, I'll our and

Charles Young

Dallas. you, Thank

and us, done through has second for the another and now provide time have our particularly our maintenance begin our teams, proud to same-store operating busiest exceptional by work the quarter. I'm leasing This walk strong year thanking results for of they service residents. quarter. the I'll you of associates for I'll to been our the for

in discuss same-store core increase grew income in core with and year-over-year X.X% X.X% an core led of each same-store little rent, X.X% a improvement a of the increase by in revenues bad X.X%. other growth a by I'll year-over-year, in revenues. further, driven average NOI XX primarily of basis these Same-store X.X% an monthly increase in X.X%, of starting debt. This is expense a increase point

quarter in sequential The second marks in bad same-store see improvement to row our markets. progress we're our across the quarter debt of and continuing pleased a fifth

conditions. was reductions the expense, hard Next, will repairs in reflecting more offset which which X.X%. turnover quarter decrease lower due to expense on significant in his second during year-over-year a in to Jon along our as detail by drove growth XX.X% and a increase can line turnover, maintenance in discuss of core our in These partially as I'll all control. with of expense increase well of control weather to more items, tax property increases expense remarks we were share due work our expense a part XX.X% teams controllable other This what detail primarily in

mentioned I had an also the during impact well. our CapEx OpEx R&M second R&M quarter. impacted as outsized It on that weather

that impacted of year come and our with R&M of you felt, the compared OpEx higher both heard last. season during We and to spend saw probably in that many second you hotter the arrived R&M this HVAC markets most quarter As and through early CapEx. summer

results rent return lease grew quarter. which our to for second Next, while Year-over-year about a X% business, represents X.X% I'll new review the our same-store to Together, rent renewal X.X%, year-over-year, growth growth, year-over-year. of brought historical What's quarter averaged same-store the pre-pandemic occupancy, period the our rates X/X increased our blended this represents different which XX.X% healthy prior leasing than quarter. pre-pandemic compared which our in points historical is quarter higher to norm notably X-year XXXX for for basis approximately second the XXX XXXX. second or second average now the to

normal to comes degree we expect seasonality the return portfolio. as to see summer ahead, a of Looking to a season our close, leasing

new is year the being rate have move month While of the lean revenue likely driver. we does, growth and summer continue expect growth peaked a reflect our occupancy, we in occupancy it in we deeper usual and That occupancy week June, move-outs traditionally remaining the a typically May most particularly that to normal half on as in second July, next seasonal anticipate into core will curve. we to impactful this lease still and as said, here that and as

as I'm genuine delivered. standards asked teams their and for has business, our lot the right to and again, doing this grateful elevated core high and their experience, really what's them of Once We've year of additional our our outstanding. values the of our they to we've grown management resident care third-party a results our living improvements been especially customers. for I'm performance made for dedication proud

over I'll to Jon Financial With the our Officer. turn now call Chief Olsen, that,

Jonathan Olsen

Thanks, Charles.

$X.X a net X.Xx credit X/X markets. providing we billion homes debt approximately of XX. undrawn were and by the debt XX, wholly fixed or rated unencumbered XX% on Unsecured cash our second capacity nearly sheet comprised debt capital balance revolving our rate unrestricted in update liquidity over our total begin our EBITDA owned swapped of and our and of was quarter. ratio rate end Virtually to the to fixed all was indebtedness adjusted at on at June and our had combination available I'll of through June investment-grade facility. of the At an

earnings and As last previously Moody's issue-level upgraded rating to with X credit stable announced BAA we our on BAA our issuer in call outlook. a from April, X

have we've $X.X final until along with comprised As term balance $XXX securitization reaching of our before, facility, million revolver. when with does as a maturity our credit XXXX-X an final undrawn is XXXX IH we of X-year no discussed reaches $X approximately a debt which current loan maturity billion billion

While swap year. we this next. later we consistent instruments prior time consideration this XXXX, historically mature in maturities our we'll and of to year remaining also and later of plenty anticipate our is approach various balance with This to have sheet managing is that proactive address these

issuance. from expect our year as cash with IH this later August we the to earmarked bond we XXXX-X that repay planned, XXXX securitization had Specifically,

are We on be our our we in call. in next regarding expect discussions share position a X-year bank to prior to of a with facility, earnings details also credit both to and our group further recast

financial Next, results. year-to-date I'll quarter review our second and

increased property finish solid some business, the third-party outcomes of of first included insurance a our and second increased $X.XX the $X.XX share. share, contributions These favorable to FFO to per year, to growing year-to-date mark on our quarter, and in taxes smaller share. increased a expected to management FFO markets. early AFFO AFFO renewal Year-to-date, $X.XX X.X% X.X% to half tax few $X.XX better a from the which X.X% For originally core core results while increased share X.X% per per per than

moving in As same-store to expense growth outlined while by earnings XX maintained points and to X.X% have improving guidance midpoint our same-store XX.X of release, NOI our the of the guidance basis our of down full year last basis by growth revenue midpoint the X.XXX%, guidance night's points, we same-store midpoint growth X.XX%. at

the raised year in to share. Difficulty] FFO have midpoint core addition, by of In our our night's full full $X.XX The per we last $X.XX updated release. of details are guidance earnings [Technical included

tax property where expense. think guidance appropriate remains of caution we area our continued One is

know, millage total property bills states, represent on aren't provided has information for impacted expense by far both you few Georgia the Florida and while with values final us As limited and with more taxes half being rates our item line Georgia. X expected by over date states same-store months. largest assessed from to a tax of

expense As due quarter a we've property same-store of previously first X quarter to in the fourth offset the prior to discussed, of the remain in under-accrual to elevated tax the we third expect year in this last year. quarters partial

expectation Our year-over-year is X.X%. for revised tax X% property growth to

clarity As smaller addition, from this we trending some later earlier, to better tax prudent from exists I that year. believe some early feedback it we've some Georgia is received our mentioned signs jurisdictions remain in favorable positively, and until are of cautious but

to half are year. choice in as committed and closing, second maintain we're sustainable continuing with growth, of premier to what in excited our home and to the our long-term In pleased momentum create value remain accomplished stockholders. for the driving serving leasing We the to date we've

That remarks. please questions. open concludes the line our Operator, for prepared

Operator

[Operator from Instructions] Our of UBS. first questions Michael Goldsmith comes

Michael Goldsmith

you interpret the as that seeing reduction believe were to on same-store you're I of lines, cautious being those the leaning you then Charles, occupancy? more are looking or homes? and said prepared move-outs that in end from expecting you Should the Is in occupancy. the high that tenants potentially guidance driving revenue purchase on of we incrementally along remarks,

Charles Young

reflects XX.X% question Charles. that year. is at occupancy we kind QX of step been of back overall. the If strong Great we quarter, This where are, sustain able your occupancy we've to look question. was Yes. throughout the kind

for that saw rent months. early as last blended And in as the were the pushing. You year month X occupancy, to rose got we our we every growth

QX So overall. strong was

a did for markets see us in few that reflecting we bit for What bit have And years a and that's several coming. was that of as Tampa, of moderation those last normal in that, a been we though Orlando little highflyers -- a Jacksonville. in little guide saw some the of kind of that's seasonality And that I what's seeing. also is of the think moderation you're part Phoenix,

summer get get bit seasonality later you'll occupancy the that little then year. we as that into pop down see happens back you'll to here, normal in and So the come up where start a

and how back up. as so about talk goes for it And be to trying ready minimize I far that, it around it's pop down to

a mid-Xs -- in out fall. the But In some X for terms of we lease back the October, that's less you're in seeing in show the our and we have September little and loss more summer, the more renewal and to look of ask. side, get that you moderation as into look, summer, into bit specifically where there's going the went And we up. over forward

business up that the occupancy And will healthy and We're so come expect strong. our we'll back overall. up. we back The renewals get really remains

ever pandemic been season. numbers, at you've as is blend of strong historical a of the outside time at look You XX.X% X year as with this a

bit it about turn talk Jon to little guidance. I'll over a more to So

Jonathan Olsen

spots. too fine we was on and a approach we guidance fine-tuned tried a revision. a about this doing Charles. as seeing possible reassessing was desire conservative guides. what in have to And with Look, both we took what it, couple on regard the expense Ultimately, we as particularly to our that, to thought In put transparent in quarter. point of our revenue we're that may be revenue based Thanks,

we've So June. some Phoenix, Florida, alluded moderation and Central began specifically, around May continued Charles as to, where seen into

there's a to beginning in a what's We The it had some quite seems as run markets fantastic in as the and healthy, maybe alarmed bit we but those still been not setting fatigue are markets. little year. anything particular, price don't just be about. sensitivities as supply expected there's in the of of So think following there strong though quite at

of California, the All were those the our Seattle, firing X%. that Southern markets and other all is said, Atlanta quarter. the all on half out X.X% lease I'd growth majority a saw particular, And portfolio Chicago, the over renewal of rate call our in new was South above X% vast second had X.X% renewal side, In at on of cylinders. in growth. Florida

So we feel really good about that.

do being worth In expense we Georgia, and about we've noting also there's that still it's Texas. respect think the guide. particular, Florida there know baked some into cautious months. believe next to And we'll I more talked conservatism lot with in the a few

shift So be that. bit any probably long but we we in story the to seeing will tried kind short, we're of guide fundamental revised surgical too in a own not revenue the and business,

Operator

Bank question next from our of Dennerlein the of line America. comes Josh And from

Joshua Dennerlein

any on follow-up of on kind building high Jacksonville, is has appreciate some from maybe there's out it there run setting in I the afford SFR, fatigue think in there. front? market Is supply color kind general. markets? I any incomes where the limit a that's pricing kind Maybe there has can at upper playing and just it it's and kind some of of of been to Phoenix of like like Phoenix just Is of price the just a for dynamic comments supply relative those the people -- there. Or in

Charles Young

on, It's well, we're Phoenix, sure it. is here. transparent And mentioned it seen I and Great make as Vegas about -- what this of Charles before, through short-term of think of you kind are hit seeing in And seasonality, couple we temporary markets, and I on couple build-to-rent supply Jacksonville, that Tampa, Look, we'll specifically the of fatigue, we wanted We've we that done And on in a We've seeing. markets which question. outs. to and open you these little action think work what shocks. were but moderation these ins creates of where you some that again. kind Orlando, few the these build-to-rent with some Florida coming there a the with side. happening there's lot that. fatigue, we're a that's bit

of So little I of a think both that. bit it's

And of much fatigue. that still as then as not markets there's humming Jon are really kind along, mentioned, of that other

still that's the look what can it, to markets. there's come happened starting bit little it then also think you a on inventory think see I optionality. never that the move some but I purchase Chicago markets And more and home, had to and in to low you now. a And more bit really it's we're catch couple starting up a Chicago. creates of run, out that little across in pretty

of Again, given demand long in great really country shape. the supply where we're single term, family this in

You just why fatigue that's get items kind by some of and we're markets. but market of in multiple these market, supply

Operator

question next from Our Evercore Steve comes from Sakwa ISI.

Steve Sakwa

circle to going that your opportunities? the where the And into X% Dallas are kind of Scott, over deployment, of you I forward yield kind yield. half what months? that know talked trend about with more XX the you or you might just looking wanted back the next maybe I capital How up year? do expectations of just And seeing are on think

Dallas Tanner

Dallas, to it hand Scott, a maybe who little detail, I'll add can I'll real and Steve, then start, time. more bit

ways really areas. laid and say maybe at I'd years, an better time. we having both looking at relationships of creative seeing sort with perspective We're a of on opportunities. like in the pluses. deal wanting in we But from line X what we've feels that and lot a generally kind there's being in what in the good in this, out What's we would Look, if flow cost operator beginning more of out interesting the guidance over been been regional ways the feel say, and seen little even work the our terms And acquisitions lean of of to on point sort it's Scott bit from make confirm even certainly figure numbers were our our some of to seeing of are yield maybe has about well. in year, majority yield product costs on the can we're -- we're couple expanding. are as of to new that last good It I together. harder than a

Scott Eisen

Steve, good a Thank And question. it's look, you.

very us. relationships we the builders. that their continue builders both the about the board also both to I in have the for same locations make the They choosing the sense regional we when We that obviously strategy which national in proximate came have expand is are started have trying operations on year think on communities open and picking demand. with with find to been build a our we that pipelines. us ago, We're communities and communities existing most the and and We're best to that where homes existing

under they dialogue we in to come We've for IH we're in our target whether to sense markets, contract more Look, the builders. management communities there can we also getting are or the probably And homes presence within every with to the we're if that trying in have homes the continue another looking we X,XXX-plus can underwrite make third-party do those not. with contracts. Nashville market backlog close in and we same trying new the new given that got see us maybe see particular, to with and day the albeit whether

strong I'd the right rate Denver it's the And to the partners builders. be a with trying the to we with look, like. say it's and last assets. to makes like it's there some little is pick as like sense. decisions and consistent choosing to see the the again, guidance stable on for significant, giving the analysis do I'd the be is, performance have supply location, we the a like. dialogue We Street day. say with with markets operating market on and we where continue et higher X everything to and lower, point pricing, little a of far we're yields right where be and what them As what that We months. trying we're blend company. markets cap on where supply dialogue detailed price where across pleased to picking more to strategy. we've higher to and going continues Not demographics the going a to were sort of we the locations get to they we But We been a are and consistent every some underwrite on our our add it's that We're we're very And make cetera. be the our builders the that are But trying competitive of from the

Operator

comes next from from Our question Wolfe Eric Citigroup.

Eric Wolfe

June looking I August normal think context lower renewals that bit NAREIT, the where helpful maybe at achieving pretty And sending than where increased as well. May. and sending similar versus was take any renewals would to saw was also a things where I strong share such could and were you pushback for in just curious June, you whether tenants a that little rate you're them, think I just you're be for out? July you're if versus from

Charles Young

I'll We're and Yes. start not done. with August. July

see, numbers. July share So going X.X. X.X actually a back high here, question, is of at was of X.X. were April little this moderation terms numbers ended of in for and original was came the of up X.X. start X.X your a X Xs what the to the bit at in look, about there in going part we're year, of X.X, we blend X.X, We June. all May What the talking to did of and we're But in for not we months

that, Phoenix a have that we across looked still Florida were do We about, we and cautious few got just some bit. we little in Central markets a of talked markets, that that high kind there the dragged where and as down are that's markets so flying. And

markets have Florida, the still We mentioned, South Xs in other as and there. is Jon are

-- this at of a NAREIT the to for there's of that we mentioned bit It's think What thinner a pushing well, not summer of because pushback. things. lease been we've I years. as there's couple time year think So always a I in loss

And we lean that much -- of just stay year. too loss of to year, want in that we that as turns to far. as not into so time lease don't on the occupancy, wider focused And portfolio gets the we're there's trying as And end as there. to but at get over

start we October going above high And Xs back X. to you're what went in see August up. actually out in the mid-Xs of September for kind So come to renewals and reflected that's renewal, for

So you the renewals together, back. that put all start come you'll see to

think more lease it's I of seasonality season. and loss of really move-out driven by

some through a still than lease we we're And historical -- we again, to the years, we're cleanup, bit did compliance sure and little stay move-outs getting more and full. trying going now in make we're

it's optimize so And we a the balance revenue. as

Operator

comes question Austin next Our from Wurschmidt KeyBanc. from

Austin Wurschmidt

I'm reconcile little guess of the was the still quarter. just a the fact and bit throughout a this I few things to trying stable turnover why was that occupancy down quarter,

I'm do impact in the the led a sort to of it So to And achieved that you was management platform third-party and to increases that that perspective basis you notice from portfolio? pricing the the strategy curious, in think on May. growth in-place what relative dial you onboarding saw also points or happening June demand the move-out of any back renewal April rate XX and XXX to had

Charles Young

want third take had that move seasonality we really to a to the at comes couple still people best July, as we to earlier full, the you blend we NAREIT as is This parties and second moderation in going again. markets In that we typically really impact little negotiation here. market stay is looked saw -- July, again. saw started of and with the on no question, May. is show, June, the there's and This half part that June. the last seasonality into situation. kind strong. moderation August, get a you we with And There's out May in the more Charles at June, peak bit can. of I'll We we're What some

these up. on being to few back make to as up are that few we wanted year, the We balance down expected, little in markets I showed and at months this for saw. we occupancy earlier time we pop transparent that's see. what sure on and of we're a that we that, do than going the seen just and And a then come that we

Operator

question RBC from comes next Heffern Markets. Brad of Capital Our

Brad Heffern

sure this what the can might I inquiry. but then color whatever is be? can limited accrual, what you're give you think say, I'm real on you guess, to And on you this is can liability close this or FTC you placeholder,

Dallas Tanner

Thanks. This is Dallas.

say it. hit much we a can't because pending matter. mean I it's legal You

fully summer from Since And pandemic. in disclosed we 'XX, as COVID-XX conduct requesting and cooperated we inquiry we've specifically As FTC about during our how of an that the first previously information FTC. business we've we been then, generally productive, with received with Those the dialogue the the about a quarter continued have them disclosed certainly discussions They've begun with since date. time. and we some during them we've the resolution. to discussions appreciate that potential preliminary the

you without the resolve ongoing business. how a -- paying a And of or of ultimately say contingent company liability certain a we requires And or matter and avoid made could our forward have met, the amounts it being And proceed the when matter continuing. the we The inconvenience of amount have expense potential will said, of resolution to GAAP will will be for can't including have any presently, as to resolved. it in good end circumstances the no material the admission reflects be that impact matter been consideration faith. on and would going liabilities that how do it think settlement of company know, as amount of to accrue that consider we accrued offer could June the

Operator

comes Our Wells question Jamie Fargo. Feldman from from next

James Feldman

the added talk guidance impact the from you the third-party year? for the homes quarter? earnings the about in rest And Can what's of in your incremental

Jonathan Olsen

Sure. Thanks.

$X.XX of midpoint the is that the AFFO when the we sort little of increase that FFO reflective of finding more So a what America the with the bit The were in onboarding third-party guide of at recall the things, incremental year on there's a but it Upward from about business. FFO. and other outset there midpoint of really contribution we core guidance, core the thought smaller introduced increase couple at that's upcoming to drove

Operator

comes next from Our from Linda question Jefferies. Tsai

Linda Yu Tsai

to costly this it would coming by comment do Or at X average stay more being higher you year, about expect rent? the interest go your given rates buy this peak With to is versus $X,XXX Burns John years, given that down? next think you

Dallas Tanner

It's This every started sequentially the stay seen Coast the business was you of Dallas. look length to grow. And quarter, at a average early think we started, markets our on in continued XXXX. Look, how I West great if is in question. we've

Our of West well into markets is year this to Coast in wouldn't markets average all. are getting be length its close some peak expect of stay. almost I of a X at California, fifth to California almost -- years. outside

as that appealing the supply-demand platform at the on a is of look differential scale. we additional flexibility you the would to expect cost masses efficiency services, call we As of the that lifestyle greater and we bring of housing, in as scale leasing it, outside create imbalances, this much the

it is while just may less much add would of to point to and see acceleration. we've this I tipping the differential that and that operated cost was furthermore be of between in And environment than today that lease, ownership a where in terms bid-ask or continue close an spread

think to years and us well now customer with we going stay the fifth. it's sort new probably minimum So X until fourth of with that a I they're or think

Operator

Juan question Markets. from next BMO Our Capital comes Sanabria from

Juan Sanabria

a Just question.

line. and on R&M both CapEx mentioned You the OpEx higher costs

just So I if what maybe change the for didn't CapEx in more guidance you the that change remind so despite should give be budget if helpful. or has around FAD that and curious could assuming we how would CapEx, details your us noticed core, changed. you can be AFFO

Charles Young

it and that in started line it about I'll cooled. and when Charles, hot seen specifically right what's HVACs, doing of is into and our around weather typically Look, by start a relative just cost the This you're markets early. gets we higher in both sure on and up R&M as and month terms can replacement of comes the than start. due the the is OpEx is Jon. house and how we it earlier CapEx same us year. curve dealing the And looks I'll heat you in last around budgeted the to the with resident, saw mentioned, get but for The little make a repair you. the curve of to I really summer, Thank give

got portfolio just Florida and in markets to happening -- Texas, hotter many Phoenix, our it's the So today, and just are across it that's really where from there. we impact earlier earlier, the

guidance. about I'll impacts how the it let Jon talk

Jonathan Olsen

you Juan, on Yes, Charles. think head. I hit the nail Thanks, the

has and did it's of hot. at move little revision temperatures summer guide FFO look the a we that in you if the So AFFO, not bit core fact running kicking reflective of the the been to the earlier, fact sort of peak CapEx that with

they're to be, are capital where just both the there, weren't so position yet and the we a expected to in of move sizable on expense terms given increases the we where and we in make side, year-over-year front. a AFFO relative So to on

really a what on be dissipate this or The orders controls. The pickup teams people that volume when we've once HVAC on you see of shifted looks season work sort see as year. what other a just is last repairs year the forward gotten are start sort been to turning Typically, the see and comparable maintenance starts, then is big little systems through that, order on focused shape in volume cost end. And and you of curve might It's we of familiar work of those required. bit. discovering very back very

and that probably to to continue to respect to going come AFFO So that CapEx and on guide quarter. we're watch next the more with

Operator

comes Lederman Associates. Our next Jesse question from Zelman of &

Jesse Lederman

the Nice one on A acquisition quarter. job in quick guidance.

XXX get to like existing half that that it $XXX to you'd purchase consistent for the expect homes million. second your from still need the the take normalize you of homes the in homebuilders about XXX midpoint of roughly homes year the incorporate couple you've beyond delivered current and acquired a quarters, to year-to-date of and of So looks if be spending to number I last

view to loosened from I as the acquisition. which currently, additional or source market, homebuilders, home homes So up wanted additional to do what deliveries you maybe existing seems portfolio just ask the have most a of these likely between

Scott Eisen

terms focused, and we're our the where communities the backlog and with question. Look, buying acquisition in is Scott. This and regional Yes, on builders of them. great national full Thanks. from directly we continue partial negotiate to

to and So year-end homebuilders. part would now acquisitions directly the that incremental get buying continuing the just contract we of is between under from expect

are are to they from full at that that we're we have And yield, are them some of a full communities find monetize BTR sense community us at it out sponsors the are for stabilized. communities communities acquisitions. at. there look there to to There out that look the extent and either by and And is right hard various there come when looking could exit something developed directly could few specific from obviously some fully a market. also them or and We makes are supplement homebuilders partially some are And we ready that taking full there of these developers. -- we the buying buying

Operator

Our next question comes from Haendel St.

Juste from Mizuho.

Haendel St. Juste

go pricing we're earlier to back fourth here, want to the a you that up quarter, obviously, but renewal mentioned I something bit for about going to rebound. for the expectation Charles, an to through pick seasonality expectation into of

last numbers been I the couple COVID, the but case. impacted know back of looking obviously, really last before the Just COVID. couple years, that years the hasn't even of

fourth see you into are curious I'm will recovery indeed quarter? that your guess what gives you the the I So that thoughts confidence

Charles Young

is we're no up all few it going that the capture kind that historically, numbers, you we're that curve of with year. Thanks, And we not not lease a length the normal stay, just and much think we have There's to been The COVID, just lease and summer renew as in balance there's seasonality. the we've out. seeing that. and and on pushing was you years, to get because and portfolio, long and as Haendel. I supply/demand, high with much But were see do was Yes, Coming a or at we occupied, for as compliance didn't that more the stay you talking we the renewals seeing numbers, to there can of of see off look in that lease loss the to it. you trying fall. you this seasonal into what called there's go the what and loss a don't down lot just

ask normal pandemic And to see of past in period going what that the And the curve. I start we're so that. see to we're already starting seasonal back -- expect to that up to that Xs mid-Xs the October we're the from coming that and

what what time kind see that of normal like, and tell in in loss looks the to So we will and but it's math of historical the terms is the we've seen, this it portfolio. lease

Operator

question Tricarico Our next Bank. Daniel comes from from Scotia

Daniel Tricarico

you change numbers markets this Florida, growth and could the Vegas around for Phoenix put Jon, some in expectations those Charles year? or

Charles Young

year Jon kind know year. market. are the of had The don't typically a seasonality, we talked earlier had we will think performed a might it some going. little just and to I than of return late little happened -- typically we specific bit. we be for what give about, as a this I'm speaking if is, for personally year we how Florida last and expectations I that give early watching keep that of by expected. blend here reality we momentum moderation We had in bit our And a

what in thoughtful what's seeing being those the markets. guide around think to reflecting that's so just our adjustment and we're And I in

is to more starting We've some this that build-to-rent. bit you thing It's that on kind that been things of moderation is over negotiation, have see bit little with the short-term on come high little a to for of equilibrium for and markets a Same bit seen back a But time. we'll a of little a of little Again, supply based There flying here, while. get while. Phoenix. back.

Jonathan Olsen

Yes.

But business markets Florida than felt comfortable overall -- Phoenix remains think where in the some of referencing I saw I We to really of think is a the add tried is with to reiterate to would little surgical too the is. bit growth I we non the only robust. comfortable terms reality the South Florida. other we that get feel and in probably what thing that we that

about we us the the As guide of we couple is we to be to up a have want is back said, occupancy. mentioned, the revenue more and and occupancy is rate because balance impactful between between Charles here see opens and for ultimately, months. growth. are what levers to really as we next core striking lease optimize want rate that pull to occupancy But thoughtful trade-off much Charles And in to loss and that our

Operator

comes Kramer Stanley. question from next Our from Morgan Adam

Adam Kramer

that expectations. in taxes. came property the below the kind on of Just Wondering markets which

of kind markets. think mentioned I you the some non-Florida, of Georgia

wondering that came market the below Just call expectations. in if could specific out you

Jonathan Olsen

the Great sure. In question, good in State had we first and Yes, Adam. Washington guides Minnesota, quarter.

guides So the range end half. the revision that we that guidance the good is entirely to tax property actual of recorded in to attributable top first

property So expense for we to markets just clear, up be outside are Florida assumptions growth assumptions. haven't Georgia our touched our or right? underlying those tax So unchanged, crystal of

that remarks, in and our I've in millage values As gotten values final the coming that bills in assessed have what my rates Georgia shown below have getting have are back Obviously, incorporated tax are we or prepared back assumptions. we don't yet. referenced we've

are. take not something there supported to optimism, that said I cautious bank. some what were when that's thought going to that we're we the But signs they So that's that

Operator

from from Okusanya Omotayo Deutsche comes question next Our Bank.

Omotayo Okusanya

online highlighting can much how that one talk absorbed be how expect could and you're little in of markets? just supply is about of some building? With like incremental it is actually that these the quickly a to Florida, -- much you markets in How who's doing bit coming

Dallas Tanner

Yes.

and I can't a give you would I think on out answer. starts home But Florida-specific in Scott we're answer and the both new market. exactly succinct think in absorption I agree, I a

even pipeline. in are build-to-rent operators We more and national homebuilders willing both much to deal pending that regional, add are seeing on I'd

And it, Scott, and/or some conversations in are mortgage the thinking entitlements are that slowdown of call some in they rates and low seen are of through they're where where the about rethinking delivery of project midway natural of -- And with things. Xs comes we've that in the some BTR a also operators kind it, our even from there a Xs. homebuyers or

there's And new sort supply pick. we've able definitely been some to of so where cherry

much certainly or re-echo to and Charles has like some But of you absorption. tell how that Tampa said, you've Phoenix, It's reemphasize is sensitivity what to and in Orlando. seen Jon hard to supply

product that's new it's Some of listings, marketplace. average some coming the by driven by driven into of

Operator

comes from next Anne question Street. from Green Ken Our

Unknown Analyst

is OpEx turn? have you CapEx larger so, lower the should a the turnover trend we any signifying impact to Do and from if recently whether how And at the thoughts lower look quantifying forward? on going

Charles Young

compliance And the dealing -- in up. through can lowering a But moves. as some trends of turnover with year we some as still I the Atlanta, some compliance. was We're were were through really cleanup, last Carolina, debt through Chicago got of last start pandemic, a on lot lease here. abnormally especially that during it we've working year, It SoCal's we to just prior good dynamics. low year-over-year. I work bad of our went trying been that, We're the kind of lease given If the turn kind going still bigger to made of markets, bit. the

And But about year, second as from in of spike turnover we we so especially talked we where relative cleaning to year, because were hard big we had on -- it's so a a been. last it there. have the than might historical we perspective, up why occupancy half the a higher little pushed still

of trend you're that we of little is what year of normal returning to so And bit kind that this cleanup. as a work seeing through kind back

in markets some cleanup still like How and Atlanta few others. it We have a balances out?

really have So so kind in and healthy that as costs low other driving nicely. days part time But to come the re-resident, and here those predict And driven well where a But XXs coupling is as it's starting by bit because weather. mostly as really executing where are occupancy well. what's really to -- trend being of our it it's place. Hard teams that and like of it our up. ends predict But with good down. talked are at trended trend we far, will tell. to And we R&M a turn well, about you the expense, see look that's little parts, again, in our I

things that Proud of we the the how So behaving. teams we're can and they're control. controlling that

something, add to want You Jon?

Jonathan Olsen

XXX continue of those. the a compliance points sort and of the that points good average of about think in what move second XX.X% first while number, lease some lease last were would That from about only the observation that over So the in moderation XXX cleanup. down share, about a is we're X. question, good and I it's was lower right? pretty than been out quantum our I basis move-outs quarter backlog to we see the think seeing the basis No, it's Anne, quarter, compliance I It's still has

year-over-year, more fact we within If number consideration the So that said. of And seeing controlling very feel the costly all reasonable a we're that down ongoing being say that cost those hangover. the those are good it in put together, XX% turnover typically taking and some did standard quite cleanup we the would have inclusive control, of as the COVID turn Charles compliance are relatively we neighborhood about sizable a still into of lease our move-outs things than turn. of I

Operator

comes question Ramani next from from Our KBW. Jade

Jason Sabshon

acquisitions This is for My Jason Sabshon do question to down how on accelerate? much is, Jade. rates to for need really come

Scott Eisen

I think from our -- Scott. Thanks, this is question. great

have deals, in market our for to certain what from deals especially today said range. think that as percent I builder we our our we're hurdle achieving, achieve. X-plus we to the And with the in a perspective, we've the look, set trying acquisitions and we're rate market,

much in in and our for the our and how hard for here going As of we we to cost me move and think point capital sit what is you evaluate market. acquisition treasuries. cap we prepared move exactly interest what we're basis markets for transactions every move, we're as to pay think move It's will tell rates rates to

or move interest look at market, as builders, rates buying are it's and weighted from we to can't the the tell capital, going we exactly stabilized at based obviously, will prescriptively buying you, market here rates. whether and in assets, cap sit look accordingly we much our But average buying upon opportunity we cost where how see But pivot of moves. portfolios

Operator

Our Wells from comes from next Feldman Jamie question Fargo.

James Feldman

and I you've you maybe now your think may just a taken of said in you of too because, Are I this view -- just had what I everyone think a not a surgical guidance? to you're I've this, have Jon, I on by wants clarify better to people too you you me that. couple mean just or times, revising cut. understand couple exactly want ping want of off -- to revised surgical suggesting guidance

think to you'll and you too it. have surgical said own I

Jonathan Olsen

Yes. in how were think the think and the Well, a And by too half we that we that candidly. based I we puts saw bit in we we surprised approached year. maybe first reaction I on what the learned of were mechanical takes the

bit transparent, I to were weren't because we trying X,XXX so we What ships trying sort that, of think to balance NAREIT fatigue sort the the that at be of the don't. do customer it's trend the culpa And that acknowledge that, we to that this what we weakness we the in little of of in a that that the we see on of alluded markets trying guide. saw is Charles moderation and little was hey, a certain course over the launch June, of to continuing, in of because a and of maybe was mea of people a interest our based was that was part in was give underlying business sense on referenced and the price reflected bit

Operator

Bank. comes from Omotayo Okusanya question from Our next Deutsche

Omotayo Okusanya

announced, I pipeline, X,XXX talked to homes, includes be delivered? expect X,XXX the that how you think which The about the you do quickly homes just you

Scott Eisen

something given when XX way us, Great say, to homes month within XXX let's homes question. say, from we're a those Thank a contract, let's under community. builder these you. get is in a The buying community deliver builders homes that pipelines we The any work builder.

pipeline about to X get delivered So frankly, visibility a talk getting -- or so. over our when next we could the backlog, we're quarters giving obviously is that,

have supplemental, that specific our expect in those the so of pipeline, homes And a very what that X,XXX it, we've been second and over time. then this disclosed of, homes delivered we in is XXX half delivered in gets the backlog the of balance call obviously we we be here year to

between a is forward X each there homes and a again, XX the on delivery builders somewhere get time month. and tend average deliver community schedule But contract, we to a under

look you it XXXX. is see in of at that's And why certain why that's that certain and percentage a a so pipeline, it you is half of when second half percentage

don't So leasing it homes us. makes that spread obviously, we from delivered at get us to little once, it efficient more but over XXX also all And a time. perspective, a gets for

XXX% that's we having homes, of for a a community get XXX XX instead month. So homes vacant

of can we so balance sort leasing delivered. And get homes those as our of they

pipeline, And think to we our so way that's have do. that's we in about the right disclosure the that why way that supplemental and

Operator

Eric from comes from Wolfe question next Our Citigroup.

Eric Wolfe

dropped second. Apologies, for line out a

answered embedded my guide back So in But apologies. curious this, if of I half was of blended you've for the your already spreads. the sort just year what's for

You did, I think, X.X% in half. first the

So the of in I going to just guide and of you're curious would building for the sort bit little was to could year half be if blocks what second give you of the there? get how a

Jonathan Olsen

our the growth, year. that balance thought good around full rent guidance but Eric. Xs for I core revenue be mean, growth blended the that a Xs, did It's low that would question, Yes. we articulate recall we of is high

going the is and are path of occupancy. know, from through rate X.X a you first the we story As here to half, forward balancing be

but stay take take can to where And and so can it of can to conscious full. much as rate we we we be wanting going it, when take we're to as we're going

signals aggressive if think give be see little and in what to the and time, available But react that's where driving same do. need market. revenue NOI as to stay order maximize revenue we'll the to We we I we in try to have I bit and So in and a full contribution, the we lean can. we to at keep NOI, leverage we the to pull think about

Operator

Austin Wurschmidt comes question next from from Our KeyBanc.

Austin Wurschmidt

just as providing you understand of business. what send the guess is update renewal a reaccelerating taking well and just July slower not of just trying confidence around year. transparent of the and as to the so around different appreciate you kind little a I growth in it's underlying during what a seasonally the message bit rate gives I confidence the part thought the follow-up maybe being

X% to mid-X% think, I from August highlighted, plus You to October.

So was maybe ask there expect understand recent relative on versus months. because what you been has giveback us achieved that help some to what rate here to within the achieve just asking

Charles Young

But pull kind never Yes, exact numbers and forth. always XXX we this Look, the spread there's month what ask XXX on little goes we never basis a points, if where in, basis We've what of points. can be is in of given bit we're time Charles. and X.X. is, of the It I it still say we've the XXth, lease only there's and could of between to we're -- we be back in and a at get a to on talked the kind can seasonality on May peaked new seeing left. slightly is looked moderate June May as are, going into trends. I in June, side. as July as and lease what new We side June, out, we similar kind at X.X, we we're about

over but will about from of Renewals expect aren't come the June, we that spread, because far are off a like down where renewals the we lease talked from those -- loss in and maybe little time. up of we bit

we the good XX.X%, at X% demand. seeing about, talked ending still again, going So We're as we quarter in the went seasonality, blend. into

We softening. are have that a few markets

some We kind talked We are Flo. seeing SoCal, about Chicago, rate kind top of are. this what we in half Sou that Even Atlanta we the growth at of strong. really talked markets we're really have about has point strong in of where

to do into kind will we're summer and this. are X/X couple the of XX.X%, over we renewals look, up that want and find at go of normal a to kind moderation think So the position of occupancy of back. -- Coming in a everything a that start will what is we'll in of we we back that there pop months, come like

of up and that little show a things bit So seasonality moderation in. getting little and I pushing earlier expected. like We than And leads, than we the is position are driving a the other revenue. still there. We're keep Demand saw towards we're and robust. that, we'll

Operator

Dallas session. the back This to our Tanner remarks. like over conference closing completes question-and-answer now any for turn I to would

Dallas Tanner

forward to you. Thank seeing call the We people the support. appreciate conferences. all Look at

Operator

has concluded. now conference The

disconnect. You may

Invitation Homes (INVH) 25 Jul 242024 Q2 Earnings call transcript