Key Takeaways
- • Progress Residential, the largest US manager of single-family rental homes and a subsidiary of Pretium, will pay $49.8 million to settle FTC and four-state allegations of hidden fees, according to an FTC official who spoke to Reuters.
- • The FTC alleges Progress charged renters smart home fees and fees for lacking renters' insurance that were not included in advertised rental rates, and failed to return security deposits.
- • Of the settlement, $48.5 million goes to the FTC for consumer reimbursement and $1.25 million to Arizona; Colorado, Indiana, and Utah were also expected to join.
- • The action supports the FTC's broader push on corporate cost-of-living issues, including a possible requirement that landlords list mandatory fees upfront in advertised rents.
- • Rival Invitation Homes (INVH) agreed to pay $48 million to settle an FTC action over hidden fees in 2024.
Summary
Progress Residential, the biggest US manager of single-family rental homes, will pay $49.8 million to settle allegations by the Federal Trade Commission and four states that it deceived renters with hidden fees, an FTC official told Reuters on Friday, November 6. The FTC official said the company violated the law by imposing charges, such as smart home fees and fees for lack of renters' insurance, that were not included in advertised rental rates.
The official also said Progress routinely failed to return renters' security deposits and advertised homes as "move-in ready" when they needed serious cleaning or repairs. The FTC is receiving $48.5 million, which it will use to reimburse harmed consumers, while Arizona is receiving $1.25 million. Colorado, Indiana, and Utah were also expected to join the settlement.
The case builds on the FTC's work on corporate cost-of-living issues, and the agency is exploring requiring landlords to list mandatory fees and charges upfront as part of advertised rental rates. Reuters noted that roughly 35% of Americans rent their homes and, citing a Zillow survey, that 60% of renters paid a recurring fee on top of rent last year.
Progress is a subsidiary of Pretium, a real-estate-focused investment firm that owns and manages more than 82,000 rental homes across the US. The company, founded by former Goldman Sachs executive Don Mullen, has said it aims to become one of the biggest homebuilding lenders by 2027.
The settlement follows a similar case: Invitation Homes (INVH), another owner of single-family rental homes launched in the wake of the subprime mortgage crisis, agreed to pay $48 million to settle an FTC action over hidden fees in 2024.
The official also said Progress routinely failed to return renters' security deposits and advertised homes as "move-in ready" when they needed serious cleaning or repairs. The FTC is receiving $48.5 million, which it will use to reimburse harmed consumers, while Arizona is receiving $1.25 million. Colorado, Indiana, and Utah were also expected to join the settlement.
The case builds on the FTC's work on corporate cost-of-living issues, and the agency is exploring requiring landlords to list mandatory fees and charges upfront as part of advertised rental rates. Reuters noted that roughly 35% of Americans rent their homes and, citing a Zillow survey, that 60% of renters paid a recurring fee on top of rent last year.
Progress is a subsidiary of Pretium, a real-estate-focused investment firm that owns and manages more than 82,000 rental homes across the US. The company, founded by former Goldman Sachs executive Don Mullen, has said it aims to become one of the biggest homebuilding lenders by 2027.
The settlement follows a similar case: Invitation Homes (INVH), another owner of single-family rental homes launched in the wake of the subprime mortgage crisis, agreed to pay $48 million to settle an FTC action over hidden fees in 2024.
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