The Federal Trade Commission announced on Friday that Progress Residential, the US single-family rental manager, and its owner Pretium Partners will pay $49.75m to settle charges brought by the FTC and four states over rental pricing and related practices.
The FTC said it was the largest enforcement matter taken against a landlord in the Commission’s history.
The payment is split $48.5m to the FTC, to be used for redress to consumers, and $1.25m to the State of Arizona. The order says the Arizona sum is for attorneys’ fees and costs.
The proposed stipulated order has the force of law only once the District Court judge approves and signs it. The FTC and the states filed it, with the complaint, in the US District Court for the Northern District of Georgia. The Commission vote authorising the filing was 2-0.
Under the order, the first payment of $4,500,000 to the Commission falls due within 10 days of entry. Eleven instalments of $4,000,000 follow at 30-day intervals. The order records that the defendants’ counsel holds $4,500,000 in escrow.
The defendants neither admit nor deny the allegations, paragraph 3 of the order says.
What Progress and Pretium must change under the order
Progress must advertise the “true total monthly rental price”, inclusive of all mandatory recurring fees, more prominently than any other pricing information. Both companies are prohibited from deceiving consumers about the total rental price.
They are also prohibited from misrepresenting that homes are inspected, or pass an inspection, before move-in.
They must set up a security deposit refund process with uniform withholding standards, training and records of the condition of homes. Itemised statements of deductions must go to renters within 30 days of move-out, or within the time state law requires.
Deductions are barred for normal wear and tear, for conditions that predate a renter’s possession and for certain renovation or capital improvement costs not related to damage by a renter. The order also bars standardised nondisparagement clauses and certain unfair customer service practices.
What the complaint alleges against the companies
Arizona, Colorado, Indiana and Utah joined the FTC. They allege that Progress and Pretium advertised false rental prices, charged hidden fees, failed to inspect homes before residents moved in, improperly deducted from security deposits, restricted negative reviews and failed to provide adequate customer service.
The complaint alleges that, since at least 2021, hidden fees have cost consumers tens of millions of dollars. These include a monthly smart home fee of $17 to $30 and a renter’s insurance exemption fee, which many consumers only discover in their first monthly bill.
It alleges Progress knew of the FTC’s investigation from November 2024, and that an internal Progress report on fees from late 2021 found $68.8 million in fees and what the company calls penalties.
It further alleges that Progress and Pretium rejected proposals to disclose the true total monthly price and implemented none of them.
The complaint also alleges that the majority of the conduct occurred under prior management and that new management has moved to remedy the issues.
Progress manages over 90,000 homes across 17 states, which Pretium owns through its investment funds. The complaint says Pretium founded Progress in 2014.
Christopher Mufarrige, director of the FTC’s Bureau of Consumer Protection, said: “Consumers searching for housing should have access to straightforward information about the costs associated with renting a home.”
He added that the FTC “is monitoring the rental housing market and will continue to take action where appropriate”.
The earlier FTC settlement with Invitation Homes
The FTC took action in September 2024 against Invitation Homes, which it described as the country’s largest landlord of single-family homes. That settlement required the company to turn over $48m for consumer refunds, and the FTC said it was the first enforcement action since it launched a Renters Working Group.
The FTC later sent checks totalling more than $47.2m to 444,131 consumers in that case.