Markets reacted quickly to Trump’s comments. Shares of Invitation Houses — the nation’s largest owner of single-family rental properties — fell more than 7% Wednesday afternoon. Blackstonea major player in the space it acquired Home Partners of America for $6 billion in 2021 and Tricon residential area for $3.5 billion in 2024, a decline of about 5%.
Analysts at Keefe, Bruyette & Woods wrote in a report that single-family REITs include REITs American houses 4 rent (AMH) and Invitation Homes (INVH) fell between 7% and 9%, while homebuilders fell about 2%. Mortgage lenders, meanwhile, were flat or grew in the high single digits.
The analysts described the market reaction as ‘excessive’. That’s because single-family rental REITs buy a modest number of homes through the MLS – most purchases right now are from homebuilders or direct development. Meanwhile, lenders would direct the inventory so that it ends up elsewhere on the market.
“While policy uncertainty is meaningful, there should be limited impact in the near term,” KBW analysts wrote. “Any regulatory ban would require legislation and likely exemptions for new construction, leaving the business model largely intact. Meanwhile, homebuilders could face modest headwinds by losing an estimated 3-5% of sales volume associated with SFR buyers.”
Trump did not provide details on how the proposed ban would be implemented, but in his social post he blamed what he called “Record High Inflation Caused by Joe Biden and the Democrats in Congress” for making the American Dream “out of reach for far too many people, especially younger Americans.” He is expected to outline additional proposals in a speech at the World Economic Forum in Davos in two weeks.
Lawmakers have previously tried to restrict hedge funds and large investors from participating in the single-family home market, citing affordability and supply concerns.
Trump’s comments come at a time when investor activity has largely leveled off. According to one Redfin report released in December, investors bought approx 52,000 homes in the third quarter of 2025, an increase of 1% compared to a year earlier. These purchases accounted for approximately 17% of all U.S. home sales during the period.
The report also shows that profitability has become more challenging for both flippers and landlords, with the share of investor-owned properties sold at a loss reaching a two-year high. Still, some long-term investors continue to deploy capital, taking advantage of reduced competition.
Cotality Chief economist Thom Malone said HousingWire in a statement that a ban “could reduce house prices, but the effect would likely be modest as most investors are small-scale buyers and not large institutional players.”
Cotality data shows investors were about right 30% of all home purchases in September 2025. Small investors – defined as those who own fewer than 10 properties – made up 14.2% of buyers, compared to just 2.5% for mega-investors who own more than 1,000 properties.
Malone noted that the impact of such a policy would vary by location, with Atlanta being the only major city where institutional investors account for more than 10% of home purchases. And the proposal could have minimal impact because it would merely restrict future purchases rather than require investors to sell their current holdings.
“A drop in investor demand could also slow new construction, offsetting some of the downward pressure on prices. At the same time, rents could rise as reduced supply tightens the rental market, potentially pushing some buyers out of wealthier neighborhoods where homeownership is already out of reach,” Malone added.
Editor’s note: This story has been updated with commentary from Thom Malone of Cotality.
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