About Timothy Lobner
In September 2020 and September 2021, Timothy Lobner, as Executive VP & COO of Invitation Homes, appeared on CNBC to discuss the rental market. He stated that the company finished 2020 with occupancy "far north of 98%" and that demand remained strong, with application ratios at peak levels. Lobner noted that Invitation Homes had worked with "over a couple thousand families" to restructure or forgive past due rents during the pandemic, and expressed concern for smaller landlords "stuck in the middle" of balancing renter hardship and landlord protections. He attributed tight housing supply to the 2008-2009 housing slump, which he said caused builders to avoid overbuilding.
Lobner described the millennial cohort of roughly 65 million people as a key demographic seeking flexibility and single-family rentals. He said Invitation Homes added nearly 1,200 homes to its portfolio in the fourth quarter of 2020, and that the company intended to continue growing because "the demand is telling us that we need to." He characterized the company's position as offering a service "people have been choosing for hundreds of years" but now with greater scale and efficiency. Lobner also noted that 70% of the company's revenue came from the West Coast and parts of Florida, areas he described as having household formation at nearly twice the national average.
Source: AI-verified profile updated from Timothy Lobner's recent appearances.
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Transcript (8 segments)
I
Interviewer0:00
Joining us now to discuss that is Dallas Tanner, CEO of Invitation Homes, which is the largest owner of single-family rental properties in the US. Dallas, thanks for being with us today.
D
Dallas Tanner0:10
Thank you for having me this morning.
I
Interviewer0:13
Alright, so I want to get into this flight to the burbs that we've been talking about and what that means for your company. But first, more broadly, the fact that we did get another round of housing data this week, and it certainly indicates that at least based on that data, the bottom is in and that housing has at least so far proved to be more resilient in this country in the wake of this recession than perhaps previously expected. I want to get your take on the health of housing, and given the fact that you have so many properties and a presence in so many markets across the country, what you are seeing at some of those different major areas.
D
Dallas Tanner0:48
Well, you're exactly right. We have a really interesting vantage point as we look at the 16 markets where we own roughly 80,000 homes, and we get really good insight in terms of transaction velocity, supply and demand, and balances and other things like that. I think there's a couple of things you have to keep in mind. First, we had a lack of supply going into the pandemic, which I think given the pressure and the different thought patterns around how to push supply or bring supply to the market, it will be a little bit tricky. I think you're going to see builders start to be a little bit more cautious about which parts of the country they're going to bring in more development, which will also add to that supply-constrained feeling that's out there. I mean, there's less than four months of resale supply in the marketplace today. So I agree with what you're saying; things actually feel pretty healthy on a relative basis.
I
Interviewer1:44
And of course, those tight inventory levels have been in focus even before the pandemic hit. I wonder what that means in terms of single-family rentals right now, especially as we do hear increasingly about this flight to the burbs by so many different families and so many different Americans who are leaving the metro areas right now.
D
Dallas Tanner2:04
Yeah, I mean, remember we have 127 million households in this country, of which roughly 48 million lease in one way shape or form. Single-family leasing itself has had a tremendous amount of demand. It's roughly 17 million families that lease that way. Going into the pandemic, that demand is just continuing to grow as you think about the Millennial cohort of roughly 65 million people between the ages of 20 and 35 that want flexibility, that want to be down payment light. You mentioned the flight to the suburbs; we saw and have seen prior to the pandemic tremendous amount of demand for our product. Today, we sit roughly 97.5% occupied, with residents staying with us almost three years or more in all of our markets. That speaks to the tremendous strength of for-lease property in general and also for that flexibility I think a lot of people want in today's environment.
I
Interviewer3:01
Yeah, we've got tons of millions of Americans who are currently unemployed right now, and certainly some reports that more home buyers are extending or seeking mortgage forbearance. What are you seeing on the rental side?
D
Dallas Tanner3:14
Well, as I mentioned before, we're seeing a ton of demand. We're seeing people come in; our application ratios are as high as they've ever been. They're even stronger than they were this time last year, and this is our peak leasing season. So we'll typically see about 60% of our portfolio either renew or look for other housing options between the months of March and August. So we're right in the middle of what we consider our peak season, and it feels like demand is really, really healthy. We are undersupplied in this country, and a lot of that stems from the housing crisis in 2008/2009, where builders, developers, and people in housing in general have been cautiously growing their footprints and portfolios since, but have been scared to be overextended. I think that's put additional supply constraints in the marketplace, particularly with leasing and with the single-family leasing environment. Things are really, really healthy. We can certainly use more product to come into those markets, but if you're positioned in parts of the country like we are, where 70% of our revenue comes out of the West Coast and parts of Florida, those are high-demand parts of the country where you see household formation at almost two times the national average. So all of this is to your earlier point made on the call, pushing towards an early recovery hopefully in housing relative to what we might see in some of the other sectors.
