Profits from the top property rental companies continue to rise

A recent analysis by Accountable.US, an organization self-identifying as a watchdog, sheds light on the concerning trend of rent hikes and apparent manipulation of apartment rental prices, leading to substantial profits for some rental companies at the expense of their residents.

According to the report, Invitation Homes and AMH, identified as the largest and second-largest single-family rental companies, had a staggering combined profit of $953.1 million in 2023, a 37% increase from the previous year because of rent hikes.

Additionally, Equity Residential, ranked as the third largest publicly traded apartment owner, reported heightened profits amid rent increases, while simultaneously investing millions in property acquisitions and confronting lawsuits related to alleged privacy infringements in background checks and late fee disputes.

Accountable.US justifies its analysis by referencing the U.S. Labor Department’s latest Consumer Price Index (CPI) report, which identifies shelter costs as a significant contributor to inflation, citing a 5.7% increase in the shelter index over the past year.

Another key finding of the report was instances of purported misconduct by Invitation Homes, dating back to July 2022 during the COVID-19 pandemic, where the company allegedly employed aggressive tactics to evict tenants, coupled with subpar maintenance practices, all while increasing rents and employing profit-maximizing strategies such as “fee-stacking.”

AMH emerged as the second-largest single-family rental company as of February 2024 with over 59,000 homes. The company’s revenue in Q4 of 2023 surged by 5.5% year-over-year, fueled by a 6.1% rise in average monthly rent.

Despite criticism from Accountable.US and other detractors, AMH seemingly remained undeterred, allocating $130,000 to external lobbying firms in 2023 to oppose legislative measures addressing housing affordability issues.

Equity Residential ranked fifth according to the National Multifamily Housing Council. It now has a portfolio of nearly 80,000 units, making it one of the largest apartment owners in the U.S. 

Despite its strong financial performance and income of over $868 million, the company’s reputation has been marred by legal challenges after accusations of participating in price-fixing schemes with fellow landlords and other concerns about their ethical business practices.