Trump moves to ban big investors from buying single-family homes
Story by Craig Karmin, Rebecca Picciotto, Alyssa Lukpat, The Wall St. Journal, 1/7/26
President Trump said he will ban large investors from buying single-family homes, the administration’s first significant move to address the country’s severe housing shortage.
“I am immediately taking steps to ban large institutional investors from buying more single-family homes, and I will be calling on Congress to codify it. People live in homes, not corporations,” Trump said in a social-media post Wednesday.
It isn’t clear if Trump can carry out such a ban without congressional approval, and big investors would still be able to hold on to their hundreds of thousands of existing homes. Yet if the president is able to enact a ban, it would likely ripple through a number of major housing markets across the country.
Wall Street’s presence in the housing market began growing after the subprime mortgage crisis started to erupt in 2007, even though institutional investors have never owned more than a tiny slice of the overall housing market. Some estimates put the figure around 2% to 3%.
But in several cities, investors hold a significant share of homes. During the pandemic housing boom, investors accounted for more than 20% of all home sales in some hot markets, including Houston, Miami, Phoenix and Las Vegas.
Sunbelt cities have been a particular target for institutional homeownership. A 2024 analysis by the Government Accountability Office said large institutions owned 25% of rental homes in Atlanta and 18% in Charlotte.
Investors of all sizes, including mom-and-pop landlords, spent billions of dollars buying homes over the past dozen years. At the 2022 peak, they purchased more than one in every four single-family homes sold. Most of these purchases were made by small investors looking to rent out properties. Investor purchases, alongside those made by traditional buyers, slowed when mortgage rates surged.
Single-family rental companies that buy up homes say they offer their residents an opportunity to live in upscale neighborhoods with good school districts that they wouldn’t be able to afford to own.
But growing voter anger over high homeownership costs has led government officials from both parties to try to crack down on institutional investors in their local markets. Nebraska, California, New York, Minnesota and North Carolina are among the states where lawmakers have proposed laws to restrict large investor home purchases, though most haven’t gone anywhere.
Home prices are up more than 50% nationally since 2019, and the median existing-home price in November rose to $409,200. Home buying overall has dwindled over the past three years due to high home prices and the surge in mortgage rates.
Investor purchases have also made it harder for some first-time buyers to compete with Wall Street-backed investment firms, with their all-cash offers. Institutions don’t always offer more money, but they are able to close a deal quickly and rarely quibble over worn flooring or dated bathrooms.
Wall Street firms and other institutional investors have scooped up hundreds of thousands of U.S. houses to rent, leading some housing analysts to assert that these purchases are contributing to a dearth of homes for sale and driving up home prices in certain neighborhoods.
“People want a place to live, but if investors flood the market on the disposition side, there’s not going to be enough buyers and that will have a really big impact on home prices,” said Jason Lewris, a co-founder of Parcl Labs, which tracks the institutional investor market.
The U.S. faces a housing shortage of several million units, depending on how that figure is calculated. Home building slowed considerably after the 2008-09 financial crisis caused home prices to plummet. That left many builders stuck with an excess of inventory. Wall Street firms, private-equity managers and other institutional investors bought tens of thousands of single-family homes, often in bulk at foreclosure auctions.
Trump would be hard-pressed to implement a legal ban without getting congressional approval. A bipartisan Senate bill last year that aimed to increase housing supply by streamlining certain federal programs and improving access to affordable mortgages passed the Senate unanimously. But it was blocked by House Republicans.
Democrats said they support limiting institutional investors from buying up homes, but objected to how Trump was going about it, and noted that Republicans have blocked similar attempts in the past.
“Trump should start with getting his own party in the House to support a bipartisan bill to bring down housing costs that passed the Senate unanimously,” U.S. Sen. Elizabeth Warren (D., Mass.) said in a statement Wednesday. “And Congress should work on legislation to stop corporate investors from buying up homes.”
An investor ban would also likely require exemptions for new-home construction, analysts at investment bank Keefe, Bruyette & Woods said in a note. Corporations that invest in single-family homes would have several ways to argue that a ban is a violation of their constitutional rights, according to the American Bar Association.
“The pushback won’t just be from our industry,” said Sean Dobson, chief executive of Amherst, a single-family rental firm that owns about 47,000 homes. “This is anti-free-market, anti-property-rights kind of policy.”
Share prices of large institutional homeowners plummeted. Invitation Homes was down about 6% at Wednesday’s market close, while shares of American Homes 4 Rent slid more than 4%.
Shares of home builders also fell on Wednesday. These firms sometimes sell their excess supply to large investors or build homes specifically for these firms to rent. D.R. Horton’s stock price was down more than 3% on Wednesday.
Some single-family rental firms are already anticipating a potential slow down in investment to their businesses because of the rising political pressure compounded by this announcement. A number of companies are pivoting their business models to “build-to-rent” communities of newly constructed single-family homes, rather than acquiring existing ones.
In the first year of his second term, Trump made few material announcements to directly address the nation’s housing crisis. But the president said Wednesday he planned to unveil more housing and affordability plans in coming weeks.
The administration last year announced a task force that would identify federal land for housing development but has made little progress on that since.