Invitation Homes, the largest owner of single-family rental homes in the US, has agreed to pay $48 million to settle allegations by the Federal Trade Commission (FTC) that it used deceptive business practices, including charging tenants hidden fees and unfairly withholding security deposits.
The proposed settlement, announced Tuesday, stems from claims that the Dallas-based company reaped millions through undisclosed charges added to renters’ monthly payments.
According to the FTC, Invitation Homes, which manages more than 109,000 properties across the country, imposed mandatory fees for services like internet packages and air-filter delivery that were not included in the advertised rental rates. Between 2021 and mid-2023, the company allegedly charged tenants tens of millions of dollars in such “junk fees,” misleading renters about the true cost of their leases.
The FTC also accused Invitation Homes of unfairly retaining security deposits by charging tenants for normal wear-and-tear and failing to disclose federal eviction protections during the COVID-19 pandemic. Some tenants reported severe maintenance issues, including broken appliances and rodent infestations, despite the company’s claims of offering a “worry-free leasing lifestyle.”
The funds from the settlement will be used to provide refunds to affected tenants, pending approval by a federal judge. As part of the agreement, Invitation Homes will now be required to fully disclose all fees in its listings and ensure fair handling of security deposits.
In response, Invitation Homes stated that the settlement does not admit any wrongdoing and emphasized that the company is committed to improving its services for renters. Shares of the company fell 2.6% following the announcement.
The Associated Press, CBS News, and the Wall Street Journal contributed to this report.
