On March 12, the Senate passed a housing package whose advertised goal is to increase housing supply. It contains a politically loaded bill to restrict institutional investors in the single-family-home market.
Titled “HOMES ARE FOR PEOPLE, NOT CORPORATIONS,” the bill may not make it through the House’s version of the package — or past the President’s desk. But it has already spurred debate over whether limiting companies that buy homes will benefit people in search of affordable, appealing housing.
The issue has roots in the Great Financial Crisis. Investors — typically small ones — were in the single-family market before that, but beginning in about 2012, larger institutions seized on deals, especially foreclosures. Their buying peaked in 2022. Investors have since dropped to about 16 percent of all homebuyers, with large firms at just 3 percent of that, according to Redfin.
Legislators had seen parts of 21st Century ROAD to Housing Act, sponsored by Massachusetts Democratic Sen. Elizabeth Warren, before March 2, when she and Sen. Tim Scott (a Republican from South Carolina) introduced it. But previous versions lacked the section about large investors, which Warren called “a good first step to rein in corporate landlords that are squeezing families out of homeownership.”
For once, Warren was following President Donald Trump’s lead.
“For a very long time, buying and owning a home was considered the pinnacle of the American Dream,” Trump wrote on Truth Social early this year. “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.” New York politicians got there even earlier: In 2025, Gov. Kathy Hochul passed rules to keep “hedge funds, private equity firms and other institutional investors” from outbidding individuals.
Yet as soon as the contents of the latest Senate package became clear, blowback ensued. “A more accurate title would be the Path Toward the Destruction of Property Rights Act,” Sen. Rand Paul, a Republican from Kentucky, posted on X. “That’s bananas,” said Sen. Brian Schatz, a Democrat from Hawaii, about the provision that some investors would be forced to sell single-family rental homes they’d built after seven years.
Against a backdrop of affordability worries, The Real Deal asked an advocate on each side of the issue to make his case. Michael Barrett, a nonprofit executive, argues that families must have as much access as possible to homeownership, while Sean Dobson, the CEO, CIO and chairman of The Amherst Group, the largest privately held company in the sector, contends that residents benefit from having affordable options in all kinds of housing stock, including for-rent single-family homes. Debate positions were accurate as of March 20.
NO
Sean Dobson
Chairman, CEO & CIO of The Amherst Group
Homeownership remains one of the most important pathways to building wealth in America. But expanding it requires an honest diagnosis of what is standing in the way. Limiting investors in single-family homes may be politically appealing, but the unintended consequences for renters would be severe. If investors were forced to sell rental homes, it would lead to widespread relocations and housing instability for families who rely on these homes. Put simply, it would worsen affordability and put the American Dream out of reach for many vulnerable households.
These impacts are especially significant when you consider who lives in single-family rentals.
More than 14 million households rely on this housing today. They are diverse, working families making decisions based on affordability, school access, job location and financial reality. Black and Hispanic households represent about 40 percent of single-family renters but only around 20 percent of homeowners, and homeowners tend to earn more than renters. These disparities reflect structural barriers — income, credit access and down- payment requirements — not investor activity in the housing market.
Institutional investors represent a small share of the market — roughly 1 percent of single-family housing stock. They are not the reason families are struggling to buy homes. The real barriers are limited access to mortgage credit, a lack of housing supply, high construction costs and restrictive zoning and permitting. Policies aimed at institutional owners would not solve those problems. They would instead pull capital out of the system, making it harder to build, renovate and preserve homes at scale.
Limiting single-family rentals will not convert renters into homeowners. Fewer than one in five renters say they would try to purchase a home if they could no longer live in their current rental, while more than one in 10 say they would face housing insecurity, including living in a shelter, car, motel or other temporary housing. Restricting rental housing does not expand opportunity. It displaces families while doing little to address the real drivers of high housing costs.
For many residents, single-family rentals make stable neighborhoods and upward mobility possible. More than half of renters say renting helps them access better neighborhoods and economic mobility that would otherwise be out of reach, and 52 percent of renters with children report better educational opportunities. That is not a policy failure. It is a legitimate housing option serving real needs.
Institutional capital also helps improve housing quality and expand available supply. The median U.S. home is now around 45 years old, and millions of homes require significant rehabilitation. Investors often supply the capital needed to renovate aging homes that might otherwise remain vacant or deteriorate, bringing them back into use while providing professionally managed, quality homes that support long-term stability.
If policymakers want to improve affordability and expand homeownership, the answer is not restricting institutional investment. It is pursuing serious housing policy reform: modernizing mortgage finance, expanding access to credit, easing zoning and permitting barriers and supporting the renovation and preservation of existing homes. Housing policy should expand options and opportunity, not reduce them.
YES
Michael Barrett
Attorney, veteran & CEO of Habitat for Humanity of New York State
The United States is enduring an unprecedented housing crisis. Low stock, not enough production and escalating costs are preventing families with two or three jobs from affording a home. And while there are several causes, the one bell that can’t be un-rung is the increasing prevalence of starter homes being purchased by corporate investors.
It’s a tragic tale pressed into our consciousness by Frank Capra’s “It’s a Wonderful Life,” where the sudden absence of the local bank, which had long facilitated prosperity in the middle-class town of Bedford Falls, gave rise to the opportunistic and predatory Mr. Potter, who leveraged his wealth to turn all those families into renters beholden to a landlord who cares only about profits. The families could do little but watch as their rents rose and homes fell into disrepair. Oh, if only it were fiction.
Sadly, the parallels are too stark to ignore. While corporate investors initially presented themselves as a lifeline for failing neighborhoods, they are now competing, and winning, against middle-class families in search of their first home. And the trend is terrifying. In 2010, very few homes were corporately purchased; 10 years later, it was around 400,000; and last year, three homes out of every 10 were purchased by investors. Where do you suppose things are headed?
And what Potter did to the families in Bedford Falls, corporations will undoubtedly do to the American middle class. Since house values tend to rise, homeownership has been the greatest cultivator of generational wealth. But now that private equity is buying up the housing stock, they are erasing this powerful wealth-building tool for families. And investors possess incredible advantages, such as rent-backed security, which enables corporations to buy homes by leveraging the rent they will collect in the future.
Like Mr. Potter, when corporations own a significant percentage of any neighborhood, they have political influence. When a corporation became the largest landlord in one neighborhood in Ohio, it began to seek lower tax assessments, which would decimate budgets for schools, roads and police. Everyone in Bedford Falls might have hated Potter, but they had no choice but to rely on him for their most basic need: a home. That’s the situation corporate investors are hoping to achieve.
There is no marker more linked to the American dream than home ownership. The antithesis of this, which represents a frightening symbolism, is to wake up one morning and realize that Mr. Potter now owns Bedford Falls.