Trump Suggests Ban on Institutional Investors Buying Single Family Houses

In an online post, President Donald Trump wrote that he intends the measure to mitigate the housing crisis resulting from an upward spiral of costs.

President Trump stated in on online post on Wednesday that he plans to take steps to ban institutional investors from purchasing single-family housing units, a move he says is intended to alleviate the high costs of housing in many metropolitan areas.

“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,” Trump wrote in a post on social media, noting he will discuss further housing and affordability proposals at the World Economic Forum’s annual conference in the ski resort town of Davos, Switzerland in two weeks.

Asset managers such as Blackstone Inc. frequently take the blame for high housing costs that have ballooned since the COVID-19 pandemic. Blackstone stock was down nearly 10% on Wednesday afternoon, following Trump’s post.

“Our ownership of U.S. single-family homes represents about 2% of our real estate AUM and 0.5% of the overall firm,” a spokesperson for Blackstone said via email. “We have also been a net seller of homes over the last decade – with our holdings down more than one-fifth. That said, we believe our current portfolio is poised to continue to perform quite well and operate at the highest standards for residents.”

Shares in companies that build houses, including D.R. Horton, Lennar Corp. as well as more specialized companies such as NVR and Toll Brothers, were also down Wednesday, but to a lesser degree.

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A November 2023 report from the Hamilton Project, of public policy think tank the Brookings Institution , noted that large investors—defined by several data sources as those owning at least 1,000 properties—accounted for 3% of the total single-family rental market. They had about 79% of their holdings concentrated in 20 markets, “mostly in the Southeast and Southwest,” and in those 20 markets, these “mega investors” accounted for 12.4% of occupied single-family rental properties.

Housing costs have increased by 7.41%, annualized, over the past five years, according to the S&P Cotality Case-Shiller U.S. National Home Price NSA Index.

“Blaming institutional ownership for housing unaffordability is inaccurate and gets both the problem and the solution wrong,” said Sean Dobson, CEO, CEO and chairman of Amherst partners, in a statement. “America’s housing crisis stems from years of policy failure, not the families who rent or the capital that houses them.”

Bill Smead, CEO and CIO of Smead Capital Management, in a statement noted that such policy could have unintended consequences for renters. “Large institutional investors are a small share of the market and have been net sellers for multiple consecutive quarters, which weakens the narrative that they’re the main driver of prices,” Smead said. “A ban would likely cut off one of the few channels supporting new supply and could reduce single-family rental availability.”

The institutional real estate asset class as a whole has been the worst-performing for many institutional investors in recent years, with several public pension funds and other asset owners still reeling from years of negative returns.