FirstKey Homes LLC, one of the largest institutional single-family rental operators in the United States with a portfolio of more than forty thousand homes across more than thirty markets, faces findings from state attorneys general investigations and federal housing agency review that the company charged tenants mandatory fees for smart home technology packages, lawn maintenance services, and other recurring charges that were either not adequately disclosed during the lease signing process, were imposed after tenants had already moved in without having been offered a meaningful opportunity to decline, or were presented in lease agreements in language that obscured the mandatory nature and total cost of the charges.DOCUMENTED
The institutional single-family rental sector — in which large private equity-backed operators own and manage thousands of individual homes across metropolitan markets — has attracted regulatory attention at the federal and state level as consumer complaints about rental practices have grown. Complaints against major institutional landlords including FirstKey, Invitation Homes, and others document recurring patterns of fee practices that consumer advocates argue exploit the power imbalance between institutional landlords with standardized national lease templates and individual tenants with limited negotiating leverage.REVIEWED
- FirstKey's smart home technology fee — charged for keyless entry, smart thermostats, and related equipment — was found to have been presented as a required charge without clear disclosure at the initial lease viewing stage
- Lawn care fees were imposed on tenants in some markets without offering the option to handle lawn maintenance independently, even where local ordinances did not require landlord-managed lawn service
- Some tenants described discovering fees only when they received their first monthly statement after move-in, weeks after signing
- Lease agreement language describing fee obligations was found to be written in terms that made mandatory charges appear optional or conditional
- Investigations covered homes in multiple states; remediation requirements varied by jurisdiction based on applicable landlord-tenant law
Smart Home Technology Fees
FirstKey standardized the installation of smart home technology packages — including keyless entry locks, smart thermostats, and leak sensors — across its rental portfolio and charged tenants a monthly fee for the technology, typically in the range of twenty to thirty dollars per month. The fee was embedded in the lease as a required charge rather than an optional upgrade. Consumer complaints documented cases where tenants were not informed of the technology fee during initial property showings, where the fee was buried in lease addenda reviewed only at the signing appointment, and where some tenants were told the technology was a standard feature of the home without being informed that a recurring monthly fee was associated with it.DOCUMENTED
State attorneys general found that the disclosure of the technology fee did not meet applicable consumer protection standards in several jurisdictions, because the fee was not presented to prospective tenants as part of the total monthly housing cost during the initial leasing inquiry and property showing stages — the stages at which a prospective tenant makes the core decision about whether the home is affordable and suitable. Discovering a mandatory monthly fee at the lease signing stage, after having committed time and often an application fee to the property, reduces the practical ability to reject the fee without losing the housing opportunity the tenant had been pursuing.DOCUMENTED
Lawn Care and Mandatory Service Fees
In multiple markets, FirstKey imposed mandatory lawn care service charges on tenants without providing an alternative option for tenants to maintain the lawn themselves. The lawn care service was priced at rates that independent tenant analysis found exceeded competitive market rates for the same services, and tenants who attempted to opt out of the service by proposing to handle lawn maintenance themselves were informed that FirstKey's lease terms required the company-managed service — in some cases without a legal basis for that requirement under the applicable state's landlord-tenant law.DOCUMENTED
Investigators found that the lawn care fee structure, like the technology fee, was not prominently disclosed during the property showing and initial leasing inquiry stages. Tenants who called to inquire about a listed FirstKey property and asked about the total monthly cost were typically given information about the base rent without the mandatory ancillary fees that would bring the total monthly obligation materially above the advertised rental rate.DOCUMENTED
Tenants who believed they had agreed to pay a specific monthly rent discovered at or after move-in that mandatory fees for technology services and lawn care added twenty to sixty dollars per month to their obligation — charges that had not been included in the rental price represented during their property search.
Federal Housing Agency Interest
Federal housing agencies with jurisdiction over rental housing practices have grown increasingly attentive to the fee practices of institutional single-family rental operators, recognizing that the scale of these operators — and the standardized nature of their lease templates, which are implemented consistently across tens of thousands of homes — means that problematic fee practices affect a large number of tenants simultaneously. The concentration of institutional rental ownership in specific metropolitan markets has also attracted attention, as tenants in those markets may have fewer alternatives that allow them to avoid a particular operator's fee structure.REVIEWED
Tenant advocacy organizations that provided input to investigators documented the combination of mandatory application fees, security deposits, pet deposits, and ongoing monthly ancillary fees as creating a total move-in cost significantly higher than the advertised rent — and a total monthly cost significantly higher than the monthly rent alone — in ways that make it difficult for tenants to make accurate affordability assessments during the housing search process.REVIEWED
Remediation and Tenant Rights
State regulators in jurisdictions where the fee practices were found to violate consumer protection or landlord-tenant law required FirstKey to provide clear all-in pricing — including all mandatory monthly fees — in all future rental listings and property showing communications, to offer tenants an option to handle lawn maintenance independently where applicable law does not require landlord-managed service, and to provide refunds to tenants who had been charged fees that were found to have been improperly imposed. Tenants in FirstKey-managed properties with concerns about fee disclosures should review their lease agreement against the company's current advertised rental prices for their home and contact their state attorney general's consumer protection office if they identify discrepancies.DOCUMENTED
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