The Treasury Department on Thursday moved to implement key provisions of a bipartisan housing law passed by Congress this summer, including a ban on large institutional investors purchasing single-family homes. The new regulations, which take effect on January 7, 2027, are part of the 21st Century ROAD to Housing Act, a measure that cleared both chambers with overwhelming bipartisan support in July.
The law, championed by progressive Sen. Elizabeth Warren (D-Mass.) and Rep. French Hill (R-Ark.), aims to streamline federal review processes for housing construction and boost the nation's housing supply. President Trump did not sign the bill into law, protesting Senate Republicans' failure to pass voter ID legislation, a top priority of his. The law took effect without his signature.
Trump had earlier signed an executive order directing his administration to crack down on institutional investors in the single-family home market. The new rule defines a "large" institutional investor as an entity with direct or indirect investment control over at least 350 homes. Exemptions include purchases under build-to-rent, renovate-to-rent, and homeownership promotion programs.
Treasury Secretary Scott Bessent said in a statement that the administration "continues to restore the path to affordable homeownership for millions of young and working families." He added that Treasury is "working to ensure American families and workers have a fair shot at purchasing homes in their communities by increasing housing supply and limiting large institutional investors' role in the market, while supporting a strong, stable housing market and avoiding unnecessary disruption."
The timing of the announcement, less than two weeks before the midterm elections, has drawn attention as Republicans seek to retain control of Congress amid widespread economic frustrations. The move aligns with broader GOP efforts to address housing affordability, though some lawmakers have urged the party to acknowledge economic pain more directly.
Housing experts, however, caution that the ban may have limited impact. Sean Fergus, vice president of economic research at Zonda, noted that institutional investors own roughly 500,000 to 800,000 homes nationwide—only about 0.5 percent of the total housing stock. "Even assuming the high end of that range, it's only 0.5 percent of total units and still under 1 percent of the roughly 100 million single-family homes in the country," he said in January.
The housing market remains strained, with pending home sales down 7.3 percent from August to September, according to the National Association of Realtors. Freddie Mac reported Thursday that the average 30-year fixed mortgage rate climbed to 7.32 percent this week, further dampening affordability. Also on Thursday, Trump signed an executive order aimed at lowering government-backed mortgage payments.
The Treasury's rulemaking is the latest in a series of policy moves ahead of the midterms, where tariffs have also emerged as a key issue. The administration's focus on housing reflects a broader effort to address voter concerns, though experts remain skeptical about the direct effect of the investor ban on prices.
