December 12

Watch and Win!


Democrats in Congress have introduced a bill to prevent hedge funds from buying and owning single-family homes in the US. The legislation would require hedge funds to sell their current homes within 10 years and eventually prohibit them from owning any single-family homes. The bill includes tax penalties to incentivize divestment and allocate funds for down-payment assistance. If passed, the law could disrupt the housing market and potentially increase availability for individual buyers, addressing the growing issue of unaffordable homeownership in the US.

Senator Jeff Merkley of Oregon, along with Representative Adam Smith of Washington, introduced the bill, highlighting the fact that ordinary Americans are now competing not just with other families but also with the billionaires of America for these houses. Consequently, this situation is causing a surge in both rental prices and home prices.

In a separate legislative move, Representatives Jeff Jackson and Alma Adams, both Democrats from North Carolina, presented the American Neighborhoods Protection Act on Wednesday. This proposed legislation mandates that corporate owners of more than 75 single-family homes pay an annual fee of $10,000 per home into a housing trust fund. The funds collected would then be utilized as down payment assistance for families.

Given the current divided Congress, it is unlikely that these bills will become law during this session. However, Mr. Smith emphasized the importance of initiating a dialogue among legislators.

The introduction of these bills comes three months after The New York Times published an article investigating the impact of corporate-backed investment on Charlotte, N.C. In 2022, investors purchased 17 percent of the city’s homes in cash, often outbidding first-time buyers who heavily rely on mortgages.

In a recurring trend observed in cities across the nation, corporations targeted reasonably priced houses, often located in neighborhoods with significant Black and Latino populations, and transformed them into rental properties. In a specific area in east Charlotte, investors backed by Wall Street acquired half of the homes sold between 2021 and 2022. Remarkably, on a single block, all but one home sold during that period were purchased by an investor who subsequently rented them out.

Following the 2008 housing crisis, Wall Street ventured into the single-family rental market by acquiring foreclosed homes. Since then, their influence has steadily grown. As of June 2022, institutional investors possessed 3 percent of all single-family rentals nationwide. However, in more affordable markets like Charlotte, their market share reached a substantial 20 percent, as reported by the Urban Institute. Despite the housing market’s slowdown, investors have remained active, purchasing 26 percent of the single-family homes sold in June 2023, according to CoreLogic, a data analytics company.

In a telephone interview, Mr. Smith expressed concern about the concentration of wealth in the hands of a few individuals. He believes that commoditizing housing only exacerbates this issue, as it allows investors to reap all the financial benefits.

Contrary to popular belief, Wall Street is not the root of the problem. David Howard, the CEO of the National Rental Home Council, argues that the real issue lies in the lack of new housing. Estimates suggest that the country needs anywhere from 2 million to 6.5 million new housing units.

According to Mr. Howard, it is crucial to shape and craft policies that support the production, investment, and development of new housing. He warns that bills working against this objective will only perpetuate the challenges we already face.


bargainhousenetwork, news, real estate, realestate, realestate agent, realestateagent, realtor, worldnews, worldwidenews

You may also like

Leave a Reply

Your email address will not be published. Required fields are marked

{"email":"Email address invalid","url":"Website address invalid","required":"Required field missing"}

Get in touch

0 of 350