President Trump on Tuesday ordered his administration to develop rules that would block institutional investors from purchasing single-family homes, enacting his latest proposal to address rising housing costs.
Under Mr. Trump’s order, Treasury Secretary Scott Bessent has 60 days to develop rules that would prevent large institutional investors from buying single-family homes as well as promote sales to individual owners.
“Hardworking young families cannot effectively compete for starter homes with Wall Street firms and their vast resources,” the executive order states. “Neighborhoods and communities once controlled by middle-class American families are now run by faraway corporate interests. People live in homes, not corporations.”
“To preserve the supply of single-family homes for American families and increase the paths to homeownership, it is the policy of my administration that large institutional investors should not buy single-family homes that could be otherwise purchased by families,” the order states.
It is unclear whether Mr. Trump has the authority to impose such a ban without the approval of Congress. The idea of such a ban had long been floated by Democratic lawmakers.
Earlier this month, after Mr. Trump proposed barring institutional investors from buying houses, Rep. Ro Khanna, California Democrat and usually a critic of the president, introduced a bill in the House.
Institutional investors, which are large organizations such as pension funds or mutual funds that make large purchases, began buying single-family homes after the 2007 mortgage crisis.
Blackstone, the largest private-equity owner of apartments in the U.S. with more than 230,000 units, has spent billions in recent years purchasing real estate companies such as Tricon Residential, American Campus Communities and AIR Communities.
However, no one is really sure how much of the overall housing market is owned by institutional investors.
Some estimates have put the total figure around 2% or 3%, but in hot real estate markets such as Phoenix, Miami or Las Vegas, the amount can be as high as 20%.
Sun Belt 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.
Home prices have soared by more than 50% since 2019 and the median home price has risen to $409,200. In response, home buying has declined over the past three years amid rising mortgage rates and housing costs.
Institutional investors are able to purchase homes with all-cash offers and have the money to conduct renovations, so they rarely argue with sellers about matters like carpets or bathroom maintenance.
