FirstKey Homes Breakdown

Portfolio holdings, gross rental yields, purchase and sale activity, and more.

Jan 04, 2024

∙ Paid

FirstKey Homes has built a portfolio of 50,000+ single-family rental properties across the country, with almost half of the portfolio held in Florida, Texas, and Georgia.
FirstKey has sold few homes recently, continuing to hold properties and grow its portfolio. Gross yields remain healthy across metros, with most at a median value in the high single digits.
Detailed information about FirstKey’s recent property sale activity and gross yields by metro are available for paid subscribers at the end of the article. Gross yields have been healthy, but differ by metro.

Introduction

FirstKey Homes is a leading SFR fund with a portfolio of 50,000+ properties nationwide. Formed in 2015 by Cerberus Capital Management, today the company operates in 28 markets across the US. Despite operating nationwide with a presence in the Southwest, Midwest, and Southeast, almost half of the company’s portfolio resides in Florida, Texas, and Georgia alone, popular states for SFR operators that have significant activity in from public SFR REITs like American Homes 4 Rent and Invitation Homes.

FirstKey leaned into acquisitions during 2021-2022, with almost half of its current portfolio acquired in those two years. Compared to American Homes 4 Rent and Invitation Homes, FirstKey has acquired properties at a higher price with a median acquisition price of $268k, though part of this difference can be attributed to the time periods of most purchases, with FirstKey's portfolio weighted towards recent years after price appreciation.

Data Overview

At SFR Analytics, we leverage nationwide deed, assessor, and rental listing data to track the single family rental market. To generate this analysis, we’ve:

Identified and reconciled the entities that FirstKey has purchased homes under
Matched rental listing data to the underlying ownership information that links an entity to FirstKey
Aggregated additional sources of data, like school ratings, to provide additional context about the neighborhoods where properties are held

Note: A more detailed breakdown of data and methodology used is available at the bottom of the post.

Analysis & Results

Geographic Distribution

FirstKey has built a 50,000+ home portfolio spanning the Southwest, Midwest, and Southeast.

FirstKey’s largest states by ownership are Florida and Texas, followed by Georgia and North Carolina. This state tilt towards Florida, Texas, and Georgia is similar to the public SFR REITs. For comparison, the top three states that American Homes 4 Rent owns properties in are Texas, Florida, and North Carolina; for Invitation Homes, the top three states are Florida, Georgia, and California.

Purchase Price Distribution

Compared to workforce housing providers like SFR3 (profiled in a recent SFR post) and VineBrook Homes (profiled a few weeks ago), FirstKey buys nicer homes in more desirable areas, targeting higher income tenants including families. The median square footage of homes owned by FirstKey is 1,820 square feet, compared to almost 2,000 square feet for homes owned by other large funds and 1,200 square feet for SFR3 and 1,180 for VineBrook, both of which focus on affordability.

Acquisition History

Purchase volume accelerated significantly in 2021 and 2022, with 10,000+ properties bought in each year. With the rise in interest rates, FirstKey has slowed acquisitions, acquiring only a few hundred in 2023.

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The distribution of ratings for schools near homes owned by FirstKey is similar when compared to the public SFR REITs, having the same distribution as Pretium and scores just below American Homes 4 Rent and Invitation Homes.

Sales Activity & Market-Level Gross Yields

Unlike SFR3 and VineBrook, FirstKey has sold relatively few homes from its portfolio, continuing to hold on to properties.

Note: the remainder of this article is available to paid subscribers, sign up below for access. Paid subscribers get full access to weekly data-rich articles about the SFR market and select additional articles only available to paid subscribers.