Trump wants ban on large institutional investors buying homes

"Real estate investment trusts (REITs), private equity firms and other large institutional investors have expanded their single-family rental portfolios in recent years, drawing criticism from housing advocates and lawmakers who argue that investor activity has constrained supply and pushed home prices higher. Markets reacted swiftly to Trump's comments. Shares of Invitation Homes the nation's largest owner of single-family rental homes fell more than 7% Wednesday afternoon. Blackstone, a major player in the space that acquired Home Partners of America for $6 billion in 2021 and Tricon Residential for $3.5 billion in 2024, was down about 5%."

"Analysts at Keefe, Bruyette & Woods wrote in a report that single-family rental REITs, including American Homes 4 Rent (AMH) and Invitation Homes (INVH), declined between 7% and 9%, while homebuilders fell about 2%. Mortgage originators, meanwhile, were either flat or growing in the high single digits. The analysts described the market reaction as excessive."

"That's because single-family rental REITs buy a modest amount of homes off the MLS most acquisitions at this point are from homebuilder channels or direct development. Meanwhile, lenders would direct inventory to end up elsewhere in the market. While policy uncertainty is meaningful, there should be a limited near-term impact, KBW analysts wrote."

"Any legal ban would require legislation and likely exemptions for new construction, leaving the business model largely intact. Meanwhile, homebuilders could face a modest headwind from losing an estimated 3-5% of sales volume tied to SFR buyers. Trump did not provide details on how the proposed ban would be implemented, but in his social post, he blamed what he called Record High Inflation caused by Joe Biden and The Democrats in Congress for pushing the American Dream out of reach for far too many people, especially younger Americans. He is expected to outline additional proposals during a speech at the World Economic Forum"

Large institutional investors expanded single-family rental portfolios, drawing criticism that investor activity constrained supply and pushed home prices higher. Markets reacted swiftly to presidential comments, with Invitation Homes falling more than 7% and Blackstone down about 5%. Single-family rental REITs declined roughly 7–9%, homebuilders fell about 2%, and mortgage originators were flat or rose in the high single digits. Single-family rental REITs purchase a modest share off the MLS, sourcing most homes from homebuilder channels or direct development. Any legal ban would require legislation and likely exemptions for new construction, and homebuilders could lose an estimated 3–5% of sales tied to SFR buyers.

Read at www.housingwire.com