It’s not too often that Tucker Carlson, J.D. Vance, and Elizabeth Warren end up on the same side of an issue, but private equity’s intrusion into the housing market tends to have that effect on people across the political aisle.
Since 2008, trillion-dollar-asset managers like Blackstone have been buying up single-family homes for their portfolios and raising rent on properties in fast-growing cities like Atlanta that cut young families out of homeownership. “If you want a revolution, keep that up,” Carlson has quipped, while Warren has said this practice “tanked the dream of homeownership.” To Vance, these firms “completely crowd out the availability for homes for people who want to just buy a piece of their community.”
Donald Trump’s preview was vague, but he said he would provide more details on this affordability push in a couple of weeks at the World Economic Forum in Davos, Switzerland, where some parties in attendance probably will not be happy about the ban. (Companies with serious housing stock were totally blindsided by the news, and the stock prices of Blackstone and Invitation Homes — two of the biggest names in the sector — fell in the hours after the announcement by as much as 9 and 10 percent, respectively.)
Even if Trump manages to prevent investment firms from buying up single-family houses, the affordable-housing crisis will not be fixed by executive order. As of 2023, large investors with 100 homes or more owned only 3 percent of the housing stock. And an order from Trump — or a law passed by Congress — would not initiate a sudden Maoist land reform in Las Vegas and Atlanta, the cities where private equity does have an outsize influence on housing.
Additionally, while private equity has significantly changed the single-family-home rental market in these fast-growing cities, its current growth is not necessarily coming from expansion into purchases of suburban three-bedrooms. “The largest corporate owners are at saturation,” says Eric Seymour, a Rutgers associate professor who studies private equity in the housing market. “Some of the largest actors, like Invitation Homes and Blackstone, grew to scale in the aftermath of the foreclosure crisis when they are able to buy large numbers of homes at low costs. That window has closed.” In recent years, Seymour says, these companies still buy homes but mostly through acquisitions of smaller corporate landlords — or by investing in build-to-rent housing that, by definition, does not affect homeownership.
“Prohibiting these companies from additional acquisitions of single-family housing is not going to lead to the housing outcomes people are desiring,” Seymour says. “The demand is coming from other channels. And we have a deeply constrained housing supply nationally.”