On Wednesday, President Donald Trump announced a new major housing policy aimed at modifying homeownership opportunities for everyday Americans by banning large institutional investors from buying single-family homes.
In a post on his Truth Social platform, Trump wrote that “People live in homes, not corporations,” and said he is taking immediate steps to implement the ban while urging Congress to codify it into law. The proposal is part of a broader effort to make housing more affordable amid ongoing concerns that corporate involvement in the housing market has priced out first-time buyers and families.
The policy targets what the administration describes as “large institutional investors”, typically Wall Street firms and private equity groups, that have acquired thousands of single-family homes nationwide, particularly in rapidly growing markets. (RELATED: Taxpayer Costs of Illegal Immigration Continue to Surge Nationwide)
When large financial firms purchase mass amounts of homes and rent them out, they can reduce available inventory for individual buyers, driving up prices and squeezing out families who want to own rather than rent. Trump’s announcement has already reverberated through the markets, with housing share prices such as Blackstone and Invitation Homes falling sharply on the news.
The housing market often has large institutional investors who have significant competitive advantages over individual buyers, including greater access to capital, the ability to buy multiple properties at once, and the capacity to make cash offers. These advantages can make it difficult for families to compete in bidding wars for starter homes. The Federal Reserve Bank of Minneapolis reports that investor ownership of single-family rentals has increased over the past decade, though it remains a small share of the overall market, and may influence housing markets in some regions.
In a 2021 study conducted by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Census Bureau, they found 15% of rental property ownership were by an LLC, LLP, or LP. They also found that these LLPs, LPs, and LLCs also owned 40.4% of rental units, but owned 67.8% of units located in properties with 100 or more units.
The move also reinforces the idea that true family homeownership should support economic opportunity and community stability. Research shows that owner-occupied housing can: strengthen neighborhood engagement, promote long-term investment in local infrastructure, and help families build wealth over time. All outcomes that are often diminished when large firms dominate housing stock instead of local residents. (RELATED: Trump Administration Grants Iowa Historic Control Over Federal Education Funding)
A report from the U.S. Government Accountability Office (GAO) found that institutional investor growth in single-family rentals, particularly in Sun Belt cities, has shown relations with areas of rising rents and limited housing supply, suggesting that concentrated investor ownership may contribute to affordability challenges for renters and buyers alike. These regulations should reduce the price of the U.S. housing market, in both home ownership, and total rental cost.
