President Trump announced a ban on investment companies from buying single-family homes and forcing first-time home buyers into rental houses.
Shares of BlackRock and Blackstone fell Wednesday on the news that large institutional investors can no longer outbid families for single-family homes.
Institutional investors are described as corporations that own at least 1,000 single-family homes in three or more locations.
“For a very long time, buying and owning a home was considered the pinnacle of the American dream. But now … that American dream is increasingly out of reach for far too many people, especially young Americans,” the president wrote on his Truth Social app.
“It is for that reason, and much more, that 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,” he added. “People live in homes, not corporations.”
In the first three months of 2024, large investors paid over $1 billion for single family homes in the Atlanta-area. First-time home buyers found it difficult to compete with corporate investors for homes.
The median listing for a home in Atlanta is now $410,000, nearly double the average home listing in 2020.
Wall Street investor Blackstone owns nearly a third of all single-family homes in the entire US.
But critics argue that 60% of all home sales went to mom and pop investors, not large corporations.
“Blaming institutional ownership for housing unaffordability is inaccurate and gets both the problem and the solution wrong,” Sean Dobson, chairman, chief executive officer and chief information officer of Amherst, told Newsweek.
“Our industry is not the cause of the housing crisis, it is part of the solution,” he added.
However, institutional investors bought over 70,000 homes and listed them for rent in the Atlanta Metropolitan area. This accounts for over 30% of rental property in Atlanta.
