Large corporate buyers of single-family homes are drawing increasing scrutiny in Washington, with lawmakers from both parties advancing proposals aimed at addressing housing affordability.
Both Democrats in Congress and President Donald Trump have recently called for new restrictions on large institutional landlords that buy and rent out single-family homes, arguing the changes could help families compete for homes.
Nationally, however, the share of homes owned or purchased by large investors remains relatively small. For regular homebuyers competing in a tight market, limiting those investors might not ease bidding wars or meaningfully lower prices in most markets outside of a handful of Sun Belt metros where institutional ownership is concentrated, economists tell CNBC Make It.
How lawmakers’ proposals could work
On Feb. 24, Democratic Senators Elizabeth Warren of Massachusetts and Jeff Merkley of Oregon introduced legislation that would strip companies owning 50 or more single-family rental homes of certain federal tax benefits, including depreciation and mortgage interest deductions, and bar corporations from owning more than 30% of homes in a local market.
To encourage new construction, the bill would temporarily exempt new multifamily projects and the rehabilitation of otherwise uninhabitable properties.
The National Low Income Housing Coalition, an affordable housing advocacy organization, endorsed the measure, calling it “an important step toward ensuring that housing serves people, not speculative profit,” in a statement provided to CNBC Make It.
The Democratic proposal came after President Donald Trump urged lawmakers to add his own investor restrictions to a bipartisan housing affordability package advancing in both the House and Senate. During his State of the Union address on Feb. 24, Trump renewed his call for limits on “large Wall Street investment firms” buying single-family properties, saying homes should be “for people, not for corporations.”
Trump first proposed banning large institutional investors from buying additional single-family homes in a Jan. 7 Truth Social post. Under the administration’s proposed plan, firms owning more than 100 single-family homes would be banned from purchasing additional properties. The framework includes exemptions for companies that build new rental homes or substantially renovate them.
More recent Senate negotiations have used a higher threshold of about 350 homes, though the provision could still change as the legislation moves forward.
The role of large institutional investors
As of 2024, firms owning 100 or more single-family homes control 1.4% of the U.S.’s occupied, single-family housing stock, according to data from John Burns Research and Consulting, a real estate research and consulting firm.
In terms of annual sales, the slice is also limited. Among firms owning 100 or more single-family homes — the group targeted under Trump’s proposal — the portion of purchases that would fall under a ban could amount to less than 1% of total home sales, Thom Malone, a principal economist at real estate analytics firm Cotality, tells CNBC Make It.
Based on roughly 3.9 million home sales last year, that works out to fewer than about 39,000 transactions nationwide, he says.
Investor activity has also cooled from its pandemic-era peak. The share of home purchases by institutional investors has fallen from about 3% at its high point in 2022 to closer to 1% as higher interest rates slowed investor demand, according to separate 2024 research by John Burns Research and Consulting. The average interest rate for a 30-year fixed mortgage rose from around 4% in February 2022, peaked above 7% in 2023 and has recently eased to about 6%, per Mortgage News Daily.
At the same time, large institutional investors have become net sellers of single-family rental homes in several markets, according to research from Parcl Labs.
Where restrictions could matter most
About 80% of homes owned by firms with 100 or more properties are located in just 5% of counties covered by the data, according to a 2025 analysis by the American Enterprise Institute, a conservative think tank.
Considering the scale, the effect on national home prices would likely be limited to certain Southern metros with higher rates of institutional ownership, says Malone. In a social media post about her legislation, Warren called out three Sun Belt cities — Atlanta, Jacksonville and Charlotte — as examples of markets with high levels of institutional investor ownership.
However, “even in these markets, [institutional investors’] purchase activity is relatively light,” says Jake Krimmel, senior economist at Realtor.com.
In those cities, companies with more than 100 home purchases accounted for 4.1% of home purchases in Atlanta, 5.1% in Charlotte and 3.8% in Jacksonville between January 2023 and November 2025 — roughly two to three times the national average of 1.6%, according to Realtor.com data.
For comparison, smaller “mom-and-pop” investors — defined as those with fewer than 10 total purchases since 2015 — accounted for a higher share of purchases in Charlotte and Jacksonville and roughly the same share as large institutional investors in Atlanta, according to Realtor.com.
Banning large corporate purchases could potentially “free up” a small share of single-family inventory in select markets, Krimmel says. But, “while this could improve supply on the margin and in the short-run, the hard numbers suggest a limited overall impact,” he adds.
Setting thresholds for large landlords — whether through purchase limits or tax changes — could also push investors to restructure into smaller entities to stay under the line, says Selma Hepp, chief economist at Cotality.
She adds that relatively few investors rely on federally backed mortgages, which would limit the policy’s impact. Large institutional buyers generally operate outside federal loan programs designed for owner-occupants, according to AEI.
A closer look at Atlanta
Atlanta is frequently cited as one of the U.S. metros with the highest concentration of institutional investors in the single-family housing market.
Firms that own 100 or more homes control 5.3% of occupied single-family homes in Atlanta, compared with 1.4% nationally, according to John Burns, making it one market where the proposed rule changes could have the most visible effect.
Home prices in the metro climbed sharply during the pandemic housing boom and remain elevated at a median of $400,000 as of January, according to Realtor.com data, up from $329,450 in March 2020, putting homeownership out of reach for many would-be buyers.
Those conditions have intensified scrutiny of large landlords, says Ryan Ward, broker at Premier Atlanta Real Estate. “I have anecdotally heard people say they’ve been outbid by investors, and that’s true,” he says.
But Ward says the pandemic-era price surge was driven primarily by ultra-low interest rates, not by institutional investors. “They didn’t buy enough homes to create the supply shortage,” he says.
The deeper issue, he says, is not simply the number of homes for sale, but the type of homes available. The market lacks smaller, entry-level houses at attainable price points, while much of the new construction skews larger and more expensive.
He also says that many homes purchased by large rental operators are in lower-priced segments of the market, often serving households with lower credit scores or limited ability to qualify for a mortgage. Removing institutional buyers would not automatically convert those renters into mortgage-ready buyers overnight.
Instead, Ward says affordability is more likely to improve through a combination of moderating home prices, rising wages and local policy changes that allow builders to add smaller homes on smaller lots.
“The real answer here is streamlining the building process and figuring out ways to incentivize builders to build smaller houses,” Ward says. “I just don’t see how banning institutional investors solves the problem that it’s setting out to solve.”
The bigger supply challenge
The U.S. housing market faces an estimated shortfall of roughly 4 million homes, according to the National Association of Realtors. That persistent supply gap has been a primary driver of affordability challenges, NAR reports.
In many of the Sun Belt metros with higher institutional ownership, for-sale inventory has been rebuilding in recent years, says Krimmel. Meanwhile, parts of the Northeast and Upper Midwest that still face tight supply were never major investor hotspots — a dynamic that suggests construction constraints weigh more heavily on affordability, he says.
Without a significant increase in new construction, affordability pressures are unlikely to ease meaningfully, says Chester Spatt, a finance professor specializing in real estate at Carnegie Mellon University. Policies that restrict ownership, he argues, do not address that underlying constraint.
“Presumably, the investors who build or renovate homes have in mind providing them ultimately to someone who would live there — whether a renter or a purchaser,” he says. “I don’t view the [policies] as helping to increase supply.”
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