American Homes 4 Rent (NYSE:AMH) raised its 2026 earnings outlook after reporting third-quarter growth in rental revenue and receiving property tax assessments that came in below its expectations in several states.
The single-family rental company increased the midpoint of its full-year core funds from operations, or FFO, guidance by two cents to $1.97 per share, which would represent 5.3% growth from 2025. The new midpoint was the high end of its previous range.
Chief Executive Officer Bryan Smith said the company plans to prioritize occupancy through the end of the year as it prepares for 2027. He said demand remains solid, while elevated mortgage rates have made homeownership less affordable.
Quarterly Results and Higher Guidance
American Homes 4 Rent reported third-quarter net income attributable to common shareholders of $82.3 million, or $0.23 per diluted share. Core FFO was $0.50 per share and unit, up 7.4% year over year, while adjusted FFO rose 7.6% to $0.45 per share and unit.
Same-home average occupied days were 96% during the quarter. New lease rates increased 1%, renewal rates rose 3.3%, and the blended lease spread was 2.6%. Same-home core revenue grew 2.3%, and same-home core net operating income, or NOI, increased 2.5%.
Occupancy remained at 96% in October, Smith said. Renewal rates increased 3.3%, while new lease rate growth slowed to 0.1%.
Chief Financial Officer Chris Lau said the company expects full-year property tax growth in the mid-1% area after receiving most of its final assessments. Values were better than expected in several states, notably Texas and Florida.
The company raised its full-year same-home core revenue growth midpoint to 2.4% and lowered its core expense growth midpoint to 1.6%. Together, those changes lifted the midpoint of expected same-home core NOI growth by 40 basis points to 2.8%.
Lau attributed the revenue revision to leasing performance across the company’s markets, steadier occupancy and bad debt tracking slightly better than initially expected. He said full-year occupancy is on track to land in the high-95% range.
Development and Share Repurchases
The company delivered 498 development homes to its wholly owned and joint venture portfolios during the quarter. That included 387 wholly owned homes at a total investment cost of $156 million. It also sold 291 homes for $94 million in net proceeds.
Smith said proceeds from property sales remain the primary funding source for development, allowing the company to replace older assets with newer homes. The company has moderated development activity while retaining capacity for share repurchases.
American Homes 4 Rent repurchased 2.4 million common shares for $75 million during the quarter, at an average price of $31.39. Since the fourth quarter of 2025, it has bought back 14.9 million shares for $463 million, equivalent to nearly 4% of shares and units outstanding.
At quarter-end, net debt, including preferred shares, stood at 5.2 times adjusted EBITDA. The company had $71 million in cash and had drawn $420 million on its $1.25 billion revolving credit facility, with no scheduled maturities until 2028, Lau said.
Smith said initial yields on completed development homes have improved slightly from the approximately 5.3% the company expected at the beginning of the year. He cited construction cost controls, pre-leasing and stronger rents. Newly underwritten land deals have yields above 6%, although he said they would not significantly change overall yields immediately as the company works through its existing pipeline.
Lau said the expected slowdown in fourth-quarter deliveries was intentional: The company front-loaded construction completions to better match the leasing season. Smith added that more than 50% of homes scheduled for delivery during the rest of the year were pre-leased.
Supply and the 2027 Outlook
Chief Operating Officer Lincoln Palmer said the company believes single-family rental supply peaked in late 2025, although conditions vary by market. He said supply was being absorbed in nearly every market during the third quarter, with San Antonio an exception.
Palmer said conditions improved year over year across Florida, in Texas markets other than San Antonio, and in Phoenix. Some markets still need to absorb more inventory before pricing power strengthens, he added.
Executives declined to give formal 2027 guidance. Lau said the current 2026 outlook implies a revenue earn-in in the low-1% range for next year, below the roughly mid-1% level entering 2026. He said a stronger starting occupancy position could help year-over-year comparisons and allow the company to benefit earlier from spring leasing demand.
On expenses, Lau cautioned against assuming another year of record-low property tax growth, though he said muted home price appreciation could support a favorable outcome. He said it was too early to assess 2027 insurance costs.
Smith also said potential portfolio purchase opportunities following enactment of the ROAD to Housing Act have been relatively quiet. He expects it could take more than a year for opportunities to emerge as Treasury completes rulemaking and owners assess their options.
About American Homes 4 Rent (NYSE:AMH)
American Homes 4 Rent (NYSE:AMH) is a real estate investment trust that owns, operates and develops single-family rental homes in the United States. The company provides professionally managed rental housing to individuals and families, with properties generally located in suburban communities and designed for long-term occupancy.
The company’s activities include acquiring, constructing, renovating, leasing and maintaining single-family homes. Its portfolio includes detached houses with features such as private yards, garages and modern appliances.
