“If the proposal were changed to include foreclosures, it would likely weigh on home prices, although the timeframe of those potential foreclosures would matter,” the analysts wrote. “Alternatively, if the definition of large were more loosely defined to include investors with at least ten properties, the scale would increase and the lack of buyers could become more relevant.”
Analysts also pointed to legislative challenges, noting that such a proposal is unlikely to advance through budget reconciliation and would therefore need 60 votes in the House of Representatives. Senate – a high bar that makes passage difficult in the short term.
Move the needle
Realtor.com senior economist Jake Krimmel echoed that view. He said the economic impact would be “modest at best” and would likely not lead to significant improvements in affordability, which he said is primarily a supply-side problem.
“Institutional investors own only a small portion of the national stock of single-family homes, and Trump’s proposal appears to focus on banning future purchases rather than forcing existing owners to sell,” Krimmel said in a statement.
“Most single-family homes are owned by small landlords, and many of the markets where institutional investors have been most active are also places where inventories have already risen and price growth has cooled over the past two years.”
Even among a conservative definition of “large” investors – those with 51 or more purchases since 2001 – such buyers accounted for less than 20% of investor purchases in the first half of 2025, according to the latest Realtor.com report.
Morgan Stanley analysts also wondered whose institutional investors are buying homes. U.S. Census Bureau Data shows that while the total number of occupied homes has increased by 15.5 million over the past decade, occupied rental properties have actually fallen by around 800,000 homes.
They said large institutional investors may have grown largely at the expense of mom-and-pop landlords rather than displacing their own residents, although the numbers are national and SFR activity remains geographically concentrated.
Impact by sector
Analysts at Keefe, Bruyette & Woods (KBW) described the market’s initial reaction to Trump’s comments as “excessive.”
They noted that single-family rental real estate investment trusts (REITs) now acquire only a modest share of homes through the Multiple Listing Service (MLS), with most purchases coming from homebuilder partnerships 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.”
A report published on Wednesday by SFR analysis indicated limited market impact that would vary based on the definition of institutional investors, which was not defined in Trump’s proposal.
The report states that two bills – the Stop Wall Street Landlords Act of 2024 and the End Hedge Fund Control of American Homes Act – define these investors as having net assets of at least $50 million.
It referred to an analysis of the Office of Government Accountability (GAO) showing that 32 companies owning at least 500 homes would be affected. But six companies stand out because they own 50,000 to 100,000 homes: Blackstone, Price partners, American houses 4 rent, Invitation Houses, Amherst And First key.
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