President Trump Proposes Ban on Institutional Investors Purchasing Single-Family Homes

President Donald Trump announced on Wednesday plans to prevent large institutional investors from purchasing single-family homes, aiming to enhance housing affordability for Americans. In a social media post, Trump stated, "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."

The White House has not provided additional details on the proposed ban. Trump indicated he will discuss the initiative further at the World Economic Forum in Davos, Switzerland, later this month.

Following the announcement, shares of major home leasing and management companies declined. Invitation Homes' stock price fell more than 7%, American Homes 4 Rent dropped 6.3%, and Blackstone, which owns and rents homes, decreased by over 4%.

Institutional investors currently own approximately 1% of the total single-family housing stock in the United States, according to an analysis by the American Enterprise Institute. Their ownership is higher in certain cities, reaching 4.2% in Atlanta, 2.6% in Dallas, and 2.2% in Houston.

Research from the U.S. Government Accountability Office indicates that institutional investment can lead to increased rents and home prices, particularly in areas with high concentrations of investor-owned properties.

Some experts question the effectiveness of the proposed ban in addressing housing affordability. Edward Pinto, co-director of the AEI Housing Center, noted that institutional investors often contribute to housing supply by purchasing and renovating distressed properties. He suggested that alternative measures, such as incentivizing homeowners to rent out unused rooms and encouraging new construction, might more effectively address affordability issues.