With new legislation transforming the single-family rental market into a more highly regulated industry, could institutional investors like Pretium (as well as REITs like AMH and Invitation Homes) stand to benefit? It won&#x27;t be cheap or easy or painless, but larger players may have the scale and the stomach for a new, landmine-filled environment of SFR — and that could lead to acquisition opportunities with smaller companies suddenly branded as &quot;institutional&quot; by the new ROAD to Housing Act. Pretium, the nation&#x27;s second-largest SFR owner through its Progress Residential brand, sees such opportunities, as co-president Stephen Scherr tells us on this episode of The Rent Roll. Additionally, rental housing economist Jay Parsons shares his top 5 takeaways from the SFR REITs&#x27; earnings calls that just wrapped up — touching on similar themes related to ROAD, as well as slowly improving fundamentals and improving cost pressures and stock buybacks. Additionally, in this week&#x27;s In the News segment, Jay shares three recent headlines that challenge mainstream thinking on the role of large investors in pushing market rents.

EP#97 Stephen Scherr | Inside Pretium + 5 Takeaways From The SFR REITS' Earnings Calls

The Rent Roll with Jay Parsons

Welcome, welcome. It's The Rent Roll, your podcast on all things rental housing, apartments, single-family rentals, and build to rent. We're on episode number 97. And here's a big question I have to tee up today's episode. Will the Road to Housing Act, due to the single-family rental industry, what Dodd-Frank did to the banking industry?

So, legislation that ostensibly is targeting big brand-name institutions, but in effect, hurting smaller firms most and creating a survival of the fittest environment of regulatory landmines, leading to a wave of consolidation, favoring those that have the scale, the resources, and also, importantly, the stomach for a highly regulated market under an intense political spotlight.

And I'm going to answer my own question for you and tell you that I, at least, I'm increasingly of this point of view. And it's not that road and other regulation somehow is a benefit to large institutional investors. I mean, it is a lot of red tape. It is regulatory risk. That stuff is real. It's not painless. It can be expensive. But these larger firms, just like the bigger banks, they're better positioned for this new world than a company that has 350 houses and

suddenly just got branded as institutional by the federal government and faces some of the same regulatory hurdles that a firm with 100,000 homes faces, but cannot diversify or can't spread that risk across as many homes as the bigger company can do.

So we're going to talk about what this new world order might look like. The two big REITs, Invitation Homes and AMH, they addressed this question on their earnings calls that just wrapped up. We're going to share their perspectives and why they see expansion opportunities coming as a result of all this stuff.

EP#97 Stephen Scherr | Inside Pretium + 5 Takeaways From The SFR REITS' Earnings Calls

Read the full transcript

The candid version is on a podcast,
not the earnings call.

EP#97 Stephen Scherr | Inside Pretium + 5 Takeaways From The SFR REITS' Earnings Calls

Read the full transcript

The candid version is on a podcast, not the earnings call.

The candid version is on a podcast,
not the earnings call.