FTC Cracks Down on Deceptive Practices by Nation's Largest Single-Family Home Landlord

The Federal Trade Commission has taken enforcement action against Invitation Homes, the country's largest landlord of single-family homes. The FTC alleges that Invitation Homes engaged in a litany of unlawful actions against consumers, including deceiving renters about lease costs, charging undisclosed junk fees, failing to properly inspect homes before move-in, unfairly withholding security deposits, and using unfair eviction practices - even during the COVID-19 pandemic.

"Invitation Homes, the nation's largest single-family home landlord, preyed on tenants through a variety of unfair and deceptive tactics, from saddling people with hidden fees and unjustly withholding security deposits to misleading people about eviction policies during the pandemic and even pursuing eviction proceedings after people had moved out," said FTC Chair Lina M. Khan.

Under a proposed settlement, Invitation Homes would be required to pay $48 million in refunds to consumers harmed by its actions. The company would also be prohibited from engaging in deceptive pricing, unfair security deposit practices, and certain unfair eviction procedures going forward.

The FTC's complaint paints a troubling picture of Invitation Homes' business practices. The company allegedly advertised monthly rental rates that failed to include mandatory fees that could total over $1,700 per year. Consumers only learned of these "junk fees" after signing leases, with no ability to opt out.

Invitation Homes also made deceptive promises about the condition of its rental properties, claiming homes underwent "quality assurance inspections" and offered "24/7 emergency maintenance." However, many renters arrived to find homes in significant disrepair, with issues ranging from plumbing problems to rodent infestations. The company frequently failed to address these problems in a timely manner, leaving residents in unacceptable and even dangerous living conditions.

The FTC further alleges that Invitation Homes systematically withheld renters' security deposits, even for normal wear-and-tear or pre-existing damages, contradicting the company's representations. Across the country, Invitation Homes returned only 39.2% of security deposit dollars, well below the national average of 63.9%.

Perhaps most egregiously, the FTC says Invitation Homes used unfair eviction practices, including during the COVID-19 pandemic when federal and state eviction moratoria were in place. The company allegedly steered renters away from filing the necessary declarations to obtain eviction protection, and even initiated eviction proceedings against residents who had already moved out.

"No American should pay more for rent or be kicked out of their home because of illegal tactics by corporate landlords," Chair Khan stated. "The FTC will continue to use all our tools to protect renters from unlawful business practices."

The proposed settlement, which must be approved by a federal judge, would require Invitation Homes to significantly reform its practices. In addition to the $48 million in consumer redress, the company would be prohibited from engaging in the deceptive, unfair, and abusive conduct outlined in the FTC's complaint.

This enforcement action represents the FTC's first major move under its newly formed Renters Working Group, signaling the agency's heightened focus on safeguarding the rights of tenants nationwide. It builds upon previous housing-related cases, underscoring the FTC's commitment to cracking down on unfair and deceptive practices that exploit vulnerable consumers.

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