Key Points
Invitation Homes repurchased nearly $1 billion of stock in under one year.
Third-quarter core funds from operations per share grew 2.4% to $0.48.
Renewal rent growth reached 4.3% in the third quarter.
On its third quarter of 2026 earnings call, held on Oct. 29, 2026, Invitation Homes (NYSE:INVH) announced that core funds from operations, a metric measuring real estate operating performance, grew 2.4% year over year to $0.48 per share. Management is funding large share repurchases with proceeds from selling individual homes at retail values. This capital recycling strategy boosts long-term shareholder value when public market valuations lag physical property values. Three takeaways from the call highlight this setup.
1. Asset Sales Fund Undervalued Share Repurchases
Invitation Homes sells vacant properties in the open market to individual buyers at full retail prices. It then uses those cash proceeds to buy back its own shares at a substantial discount to property net asset value.
Since December of last year, our average gross sales price has been approximately $460,000 per home. Meanwhile, at the prices at which we've been buying back our own stock, the market is valuing our homes at only $280,000 each.
-- Dallas Tanner, President and Chief Executive Officer
2. High Ownership Costs Drive Single-Family Rental Demand
Elevated mortgage rates make buying a single-family home far more expensive than leasing one in the company's Sun Belt markets. That monthly cost gap keeps resident turnover low and supports steady rent growth on renewals.
Based on John Burns data and weighted to our markets, as of September, it was on average over $1,000 a month cheaper to lease a home than own one. As mortgage rates rise, that gap likely widens.
-- Dallas Tanner, President and Chief Executive Officer
3. Moderating Supply Growth Supports Long-Term Market Fundamentals
New competition in build-to-rent communities is slowing across core markets after peaking two years ago. Reduced new supply allows existing operators to maintain high occupancy and pricing discipline.
Build to rent delivery peaked in 2024. The pace of build to rent deliveries are anticipated to keep slowing through 2027 and 2028 based on John Burns' data.
-- Tim Lobner, Chief Operating Officer
Looking Ahead
Leasing leads and showing volumes exceed last year's levels, reflecting sustained demand for single-family rentals. Geographic focus on Sun Belt growth markets and centralized operational systems support consistent cash flow, while management tracks pricing discipline across key regions.
Lead and showing volumes are meeting or beating last year's levels, and we continue to move home steadily through the releasing process.
-- Tim Lobner, Chief Operating Officer
Disciplined capital allocation and efficient operations remain central to long-term value creation.
Looking ahead, our priorities are unchanged. Serve our residents well, run the business efficiently, and put capital where it creates the most value for stockholders.
-- Jon Olsen, Chief Financial Officer
The Motley Fool recommends Invitation Homes. The Motley Fool has a disclosure policy.