So here's a housing policy idea that sounds dramatic: ban the big guys from buying more houses. The White House is now actively trying to make that happen, according to reports, by pushing President Donald Trump's proposed ban on investors who own more than 100 single-family homes.
A memo outlining the plan has been sent to House and Senate committee leaders. The core idea is to restrict these large-scale investors—think firms with portfolios of 100 homes or more—from acquiring additional properties. If implemented, it could prevent hundreds of investment firms from purchasing more single-family homes.
But like most policies, the devil is in the details, and there are some pretty big exemptions. The proposal reportedly carves out exceptions, especially for investors who build new homes or significantly renovate properties solely for the purpose of renting them out. It also gives the Treasury Secretary some wiggle room to adjust the criteria for what counts as a "large institutional investor." Any changes would need Congress to review and approve them before the Senate and House work out their differences on broader housing legislation.
Trump is expected to discuss the proposal in more detail during the upcoming State of the Union address.
Why Congress and Experts Are Skeptical
This push comes after the idea already hit a roadblock. Trump's proposal to ban Wall Street investors from buying homes was not included in the final version of a major housing bill making its way through Congress.
Key lawmakers aren't fully on board. House Rep. French Hill (R-Ark.), the Chairman of the House Financial Services Committee, along with other Republican leaders, reportedly declined the White House's request to add the investor ban as an amendment to the Housing for the 21st Century Act. Their reasons? Timing issues and what they see as ambiguity in the proposal.
Meanwhile, some Democrats are also resisting. Their critique centers on what they view as excessive exemptions in the plan and the fact that it doesn't require large investors to sell off any of the properties they already own.
Perhaps the most significant pushback comes from the data. Experts are questioning how much impact this ban would actually have on the housing market. Jina Yoon, Chief Alternative Investment Strategist at LPL Financial, points out that individual investors, not large institutions, are the primary drivers of competition among homebuyers. The numbers back that up: institutional investors own just 0.5% to 3% of all U.S. single-family homes, and their activity is concentrated in select markets like Atlanta, Phoenix, and Charlotte. A lot of that activity might already be exempt under the proposed order's rules for new construction and renovation. A previous analysis by Blackstone (BX) highlighted a similar perspective on the market's composition.
So, while the White House is making a new push for a policy that sounds like a major crackdown on corporate homeownership, the reality is more complicated. It's facing political hurdles and questions about whether it would even move the needle for most homebuyers competing in today's market.
