Proposed Ban on Institutional Home Ownership

Summary

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Podcast Summary: Votes & Verdicts

Episode: Proposed Ban on Institutional Home Ownership

Date: May 5, 2026
Host: Michael Sasso (Bloomberg Intelligence)
Guests:

• David Howard (Real Estate and Housing Advisors; former CEO, National Rental Home Council)
• Jeff Langbaum (Senior Analyst, Bloomberg Intelligence; REIT specialist)

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Episode Overview

This episode kicks off a miniseries on America's housing affordability crisis, focusing specifically on President Trump’s proposed ban targeting large institutional ownership of single-family homes. The panel analyzes the motivations, political maneuvers, market implications, and likely effects of such restrictions, drawing on both national data and high-impact local markets (like Atlanta). The discussion probes whether institutional investors are “villains” in the housing market, and examines the proposed federal and state-level policies that could reshape the industry.

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Key Discussion Points & Insights

1. The “Villainization” of Institutional Investors

[02:35–07:33]

• Corporations have owned single-family rental homes for decades, but private equity firms and REITs became highly active after the financial crisis.
• David Howard emphasizes that the reputation of institutional investors as villains is exaggerated and “largely unfair”:
  • Institutions own less than 0.5% of all U.S. single-family homes and under 3% of single-family rentals nationwide.
  • Localized exceptions (Atlanta, Charlotte, Tampa) may see institutional market shares up to 30%, largely due to population and job growth attracting investment.
  • “A lot of the criticisms of the industry are just factually incorrect...narratives have gotten away from the industry in large measure.” (David Howard, 04:55)
• The branding of corporate landlords as bad actors intensified post-financial crisis and again during COVID, reflecting anti-corporate sentiment across sectors.

2. Local Market Realities

[07:35–09:10]

• While the national share is low, certain metropolitan areas experience a much higher presence of institutional ownership, contributing to the perception of market distortion and fueling stricter regulation.

3. Trump Administration’s Policy Proposals

[11:16–15:07]

• Jeff Langbaum details the evolution of the ban:
  • Trump’s January Truth Social post called for a ban, later formalized in an executive order and Senate bill.
  • The Senate proposal uniquely targets “build to rent” developments, requiring institutions to sell such homes within seven years—a surprising addition.
  • “Any homes built for the purpose of being a rental would need to be sold within seven years by the institution that bought [or built] it.” (Jeff Langbaum, 12:51)
• The rationale: To convert rental homes into owner-occupied stock and make homeownership more accessible.

4. Impact on Real Estate Investment Trusts (REITs) and Investors

[15:07–20:05]

• Major REITs (e.g., Invitation Homes, AMH) have been relatively quiet publicly but face existential questions about their growth model.
• Stock prices for these REITs have underperformed since the announcement but not as dramatically as anticipated—partly because the legislative process is fluid and may soften.
  • “If companies like REITs...are banned from adding to their portfolio...that changes their entire growth profile and calls into question the entire business model.” (Jeff Langbaum, 15:54)
  • The House is signaling pushback, especially on the seven-year forced sale provision.

5. Critique of Build-to-Rent Restrictions

[21:41–23:59]

• Critics argue that limiting the construction of rental homes reduces overall housing supply, counteracting the policy’s stated intent.
  • “Less supply is not the answer to improve affordability...Restricting the amount of homes, period, is not the way to improve overall affordability.” (Jeff Langbaum, 22:37)
• Renting provides necessary flexibility and access, especially when homeownership is out of reach for many.

6. Legislative Maneuvering and Lobbying

[24:01–32:19]

• Howard highlights “widespread and genuine opposition” in the House to the Senate bill’s seven-year disposition requirement.
• Many legislators, especially Republicans, became aware of these details late, complicating passage.
  • “There were a lot of folks who didn't quite understand what was in the bill…the seven-year disposition provision was actually added at the last minute.” (David Howard, 25:44)
• The future of the bill: Likely to see more moderate restrictions; the controversial “anti-supply” provision may be stripped out.

7. Market Timing and Industry Response

[32:19–34:48]

• The major boom in institutional acquisitions has already passed; both price hikes and poor returns have slowed new purchases by firms like AMH and Invitation Homes.
  • “They've slowed down purchases because they are economically driven and home prices are expensive and it's hard to make the numbers work...” (Jeff Langbaum, 32:56)
• The build-to-rent model is now more important for these firms than acquisition.

8. Rising State-Level Risks

[34:48–39:57]

• Nearly 30 states have introduced bills curbing or limiting institutional home ownership, including both blue and red states (a significant change).
  • “What is happening at the state level is very much a risk to the industry for sure. There were nearly 30 states this legislative cycle that introduced legislation...posing an existential risk to the industry.” (David Howard, 35:37)
• If federal legislation passes, Howard predicts blue states will continue to pursue even stricter rules, while red states might scale back.

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Notable Quotes & Memorable Moments

• David Howard:
  • “A lot of the criticisms of the industry are just factually incorrect. You'll see data points that speak to corporations owning hundreds and hundreds of thousands of homes...the reality is institutions in this country own a very small share of the overall housing market.” (04:12–04:55)
  • “If you look at the data, it really doesn't support this notion that you have large institutions running amok in America's housing market.” (05:14)
• Jeff Langbaum:
  • “Any homes built for the purpose of being a rental would need to be sold within seven years by the institution that bought—or built—it. That really caught everyone’s attention.” (12:51)
  • “Less supply is not the answer to improve affordability.” (22:36)
  • “A ban on buying is less of an impact on their current business than it would have been several years ago. The ban on building...that’s really the biggest sticking point.” (34:26)
• David Howard:
  • “There were nearly 30 states this legislative cycle that introduced legislation that I say poses an existential risk to the industry.” (35:37)
  • “If a bill passes in Washington, D.C...I think what you’re going to see in blue states, should there be a bill that passes...those states are going to continue with a flurry of bills targeting institutional owners. I think the opposite will happen in the red states.” (38:47)

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Important Timestamps

| Timestamp | Segment/Key Topic | |------------|--------------------------------------------------------| | 02:35 | Framing the crisis: Institutional investors as "villains"| | 07:35 | Discussion on regional variation (e.g., Atlanta) | | 11:16 | President Trump’s proposed ban and policy evolution | | 12:51 | Senate bill: The seven-year “build to rent” restriction| | 15:28 | REITs: Market reaction and business model challenges | | 21:41 | Critiques of supply-side restrictions and housing costs| | 24:01 | Lobbying and behind-the-scenes legislative action | | 34:48 | State-level legislative risk vs. federal efforts | | 38:47 | Predicted state responses if federal law passes |

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Overall Tone & Takeaways

The conversation is analytical but accessible, aiming to cut through “narratives” and partisan framing with facts, market logic, and legislative reality. All contributors caution against the blunt use of restrictions and emphasize the importance of increasing housing supply—whether rentals or ownership—to improve affordability.

The episode concludes with a call to watch both state and federal developments and acknowledges the real, evolving risks and opportunities facing both the industry and American households.

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Transcript

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[Financial Advisor/Advertiser]

The president taking immediate steps to ban large institutional investors from buying single family homes. He will be calling on Congress to codify such a movement. In his Truth Social post, he says the American dream is increasingly out of reach for far too many people, especially younger Americans. People live in homes, not corporations. You're seeing an immediate reaction in key companies.

[Michael Sasso]

You've just heard a Bloomberg News clip from January announcing President Trump's proposed crackdown on the corporate landlords that own many of America's single family rental homes. That proposal has since made its way into a Senate bill that's being hotly debated in Congress. Welcome to Votes and Verdicts podcast, hosted by the Litigation and Policy team at Bloomberg Intelligence. My name is Michael Sasso, an editor at Bloomberg Intelligence. Today I am guest hosting this episode of Votes and Verdicts, with the first

of three episodes comprising a miniseries on the crisis and housing affordability. Our first segment focuses on one of the most controversial proposals to come out of the Trump administration, restricting large institutional investors from buying single family homes. President Trump announced a ban on institutional owners in January, and it since made its way into the 21st century road to housing at the Fort Congress. My guests today include David Howard, founder of Real Estate and Housing Advisors, a public affairs firm in Washington. He's also a past CEO of the National Rental Home Council, a trade group for the single family rental industry. Also joining me is Jeff Langbaum, a senior analyst for Bloomberg Intelligence who covers REITs, including the owner of single family rentals. But with that, let's dig into the topic. David, it seems like private equity firms and the REITs that own rental homes make great villains in the public's eye. PE firms really got into single family rentals during the great financial crisis. At the time, I was a reporter in Florida, and even then there was great skepticism about the private equity firms buying up rental homes. Why is that and is the reputation deserved?

[David Howard]

Well, Mike, I think it's really a result of a number of things. And to be fair, corporations have owned single family rental homes for decades. So the fact that there are corporations in the market today, whether those corporations are backed by private equity or some other form of capital, really isn't necessarily that new of a thing. Granted, after the great financial crisis, I think that business accelerated and you saw the entry of more corporate structures in the single family rental housing space. But again, to be fair, this is a business model that largely has been around for decades. As to whether or not it is fair to characterize corporations in the single family rental housing market as villains or as the kinds of firms who are doing things they shouldn't be doing, frankly, I think it largely is unfair. First of all, a lot of the criticisms of the industry are just factually incorrect. You'll see data points that speak to corporations owning hundreds and hundreds of thousands of homes and millions of homes across the country. And the reality is institutions in this country own a very small share of the overall housing market. In terms of all the housing in the country, institutions own less than 1/2 of 1% in terms of the number of single family rental homes in this country, institutions own less than 3%. So it's one of those narratives, I think, that has gotten away from the industry in large measure. And again, if you look at the data, it really doesn't support this notion that again, you have large institutions running amok in America's housing market because it's just factually is is not the case. And I think as importantly, it does discount, I think a lot of the good work that institutional owners are doing on behalf of housing consumers, providing more options for housing that is affordable, that is located in neighborhoods and communities where people want to live, because those homes might be in certain school districts or they're new, they're near nodes of transportation or population centers or things like that. So again, I think a lot of the data that supports this notion that institutions have a larger role than they actually do is something that is worth examining. And then secondly, again, I think the criticisms around corporate ownership really don't do service to the good work that a lot of corporate owners and institutional investors are doing in the housing market. And look, that's not to say that there aren't some bad actors out there like there are in every industry, in every sector of the economy. But again, I think to generalize with some of these criticisms that are directed toward corporate owners in the single family rental housing market are often misguided and again, just not supported by the data.

[Michael Sasso]

Lou, let me follow up with you

[Podcast Host/Interviewer]

real quick on that. You mentioned that, and I've heard this statistic before, that institutions own maybe 3% of their rental housing stock around the country. I happen to be in Atlanta.

[David Howard]

There's.

[Podcast Host/Interviewer]

This may be the epicenter of the industry. I've seen estimates that closer to 30% of the rental housing stock in the Atlantic market. Is it possible that there might be a bigger impact at a market like Atlanta than maybe when you're zooming out the entire country?

[David Howard]

That's a fair point. It is true that in some markets, particularly those in some of the more vibrant metropolitan areas of the Southeast, places like Charlotte or Atlanta, to your point, Tampa, some of the other Florida markets, Nashville, certainly the percentage of ownership by institutions in the housing market, in the single family rental housing market in particular, is higher. Now, I would argue that there could very well be good reasons for that over the, over the years. These are markets that have attracted outsized population growth, outsized job growth. We know that population growth and job growth are highly correlated to the demand for all kinds of rental housing, whether it's multifamily or single family. And so again, I would take the position that there could be very good reasons why the share of the market by institutional owners in places like Atlanta or Nashville is higher.

[Michael Sasso]

What I framed up, the original question

[Podcast Host/Interviewer]

was that they're sort of become a villain of sorts in the public's eye. Has it always been that way?

[Michael Sasso]

I mean, were you seeing the start

[Podcast Host/Interviewer]

of that kind of antipathy towards the industry maybe after the great financial crisis? First off, do you agree that they've seen in somewhat, a little bit of antipathy towards the industry and when did that kind of get going?

[David Howard]

Yeah, I think that's fair. I think that, again, this was a narrative that was created post great financial crisis. It's one that the industry has not entirely gotten out from under, though, is trying very, very Diligently and I think is doing a lot of the right things to write that ship, if you will. I will also tell you that the industry really took a lot of attention during the COVID years. This was a period of time, remember,

[Podcast Host/Interviewer]

where

[David Howard]

big was bad in corporate America, not just as it relates to housing, or in our case, single family rental housing, but in all kinds of different sectors of the economy. And I think large companies in this industry got swept up in that. And so that was a period of time where the industry spent a lot of resources, a lot of effort, again, really trying to engage with the media, trying to engage with policymakers to talk about the role that the industry plays in providing affordably priced, well located housing. And it's one that I know the industry continues to work diligently on to this day. There are a lot of initiatives in place now, again, really focused on working with reporters, members of the media, policymakers to talk about the industry, to talk about the important role, not just of corporate owners, but of, but of single family rental housing generally.

[Podcast Host/Interviewer]

Jeff, I want to turn to you real quick so to talk about a little bit about the policy aspects.

[Michael Sasso]

President Trump has really come out swinging

[Podcast Host/Interviewer]

against big institutional investors just in the last several months. He's arguing that they're essentially making it harder for average people to buy homes, making it more costly for them than buy homes, reducing the availability of homes. Just take us through where, you know, what he initially said and how it's morphed at all, the, you know, what the Trump administration is looking to do here.

[Michael Sasso]

Sure.

[Jeff Langbaum]

So, you know, it started back in early January with a post on Truth Social where President Trump basically came out and said that he was going to, you know, work look to ban institutions from buying single family homes. I think that kind of caught us off guard, caught the industry off guard. And initially kind of, you know, people didn't really know exactly what to make of it, but he basically said there would be more to come and more did come. Right. So that was followed by an executive order laying out, you know, for Congress to go ahead and come up with rules, laws to ban institutions from buying single family homes. But then interestingly, in I believe it was early March, the Senate, in its housing bill that, that passed, laid out the framework to address this request. And it did a number of different things. Right. First it put certain exemptions on who would be blocked from buying single family homes and who would be allowed to buy single family homes. But more interestingly, I think is it put a restriction on build to rent housing Right. So, so homes that are built specifically for the purpose of rental. And it basically said that any homes built for the purpose of being a rental would need to be sold within seven years by the institution that bought. But it defined bought as also being acquired by construction. So if you own or build a purpose built rental home, you're going to need to sell it in seven years. And that I think really caught everyone's attention and has become the focal point of how this is going to play out from here. As of right now, nothing else has changed. The Senate's bill is out there and it's currently being discussed in the House as to kind of what the end result is going to be.

[Podcast Host/Interviewer]

What is the justification. I read that the seven year, what is the Senate's justification or proponents justification for requiring sell off in seven years? This.

[Jeff Langbaum]

Yeah, I don't, I don't, I mean I don't know what the seven, where the seven years specifically comes from. But the point at the end of the day is to get single family homes out of the renter pool and into the individual home ownership pool. And it's another way of that of accomplishing that initial point that president made in his, in his first post, which is keeping the homes out of the hands of large institutions and in the homes of the people who live in them. Right. Own and live in them. And it kind of shifted the perspective. The original intention, if institutions aren't in the market to buy homes, then obviously that would theoretically make homes less expensive for those looking to buy them for themselves. But this takes another tact which is takes homes being built for rent out of the institution and also into ownership of the people who live in them.

[Podcast Host/Interviewer]

And just, just to follow up on that, you own a couple REITs that are in this space, American Homes for Rent, Invitation Homes. What are they saying about like how this is going? Are they saying this is really going to whack their shares or rack their business model? What are they said, what do they said publicly on this, proposed this legislation?

[Jeff Langbaum]

Yeah, just to be clear, I don't own them. I follow them from, from a research perspective, just clear. But they've been fairly quiet on it publicly. Comments that they that have, have been made in public forums are, you know, more along the lines of, you know, let's wait and see exactly how this shakes out. But clearly if companies like REITs like Invitation Homes and AMH are banned from adding to their portfolio of rental homes either by buying them or by building them, then that changes their entire growth profile and kind of calls into question the entire business model. So clearly, even if they're not talking publicly out loud about it, there has to be some work going on behind the scenes to figure out how this can get remedied without changing the overall business model that they're in.

[Podcast Host/Interviewer]

David, I want to return to you just for a minute. We just spoke about build to Rent a little bit. Go back to the initial tweet. Was it a truth social post maybe that the President was targeting, I think institutional ownership of rental homes, not construction of new rental homes. Take us through. Where does that, you know, are they still in the crosshairs? Where does that proposal to restrict them from even purchasing existing homes? Where does that stand and how has it been changed at all by the Senate bill?

[David Howard]

Well, again, initially, as Jeff said, the focus of the President's tweet on 7 January and then the subsequent release of the executive order on the 19th and 20th of January was really aimed at institutional purchases and actually gave a pretty wide berth to build to Rent. Now, there was a lot that was left unsaid in the executive order. There was a lot of ambiguity. There was a lot of definition to come. So, so there wasn't a lot of detail and a lot of specificity in the executive order itself. But again, it was really geared toward institutional buying of single of existing single family homes in the housing market. And largely that was the intention of the President. If you listen to his comments in support of his executive order, in support of his initial tweet back in early January, his presumption here, here is if institutions are buying fewer homes, that means individual home buyers then will be able to purchase more, ideally at a lower price because there will be less demand coming from institutional owners. And again, we can talk about whether that is factually correct or not, but certainly that was the aim of the administration and the President himself in launching this crusade.

[Podcast Host/Interviewer]

If you will, back back to you, Jeff, a little bit just on the investors themselves. Are the REITs that you, that you follow? I didn't mean to say own the REITs that you follow. How are investors reacting to this? Are they, has it hurt the shares? Are they staying away from the space? What has happened with regard to investors in these companies?

[Jeff Langbaum]

The shares of both AMH and Invitation Homes have underperformed, you know, not necessarily by as much as you might think think given that they were basically individually targeted by all this. The numbers that I have, you know, from the day before the original Truth Social post through Friday's close, AMH was down about 6% Invitation Homes was down about 3%, three and a half percent. The, the overall Bloomberg Residential REIT index was down about 3% and overall REITs were up about 10%. And so they've underperformed, but they, what was interesting in those numbers is that they haven't underperformed significantly versus the overall residential REIT index. Some apartment REITs which are not targeted by any of this have underperformed by more. And you know, that's just based on a general market wide concern over

[Michael Sasso]

what

[Jeff Langbaum]

the rent growth picture looks like for multifamily rental housing. And these companies have seen their growth rates shrink throughout last year and some of the prospects based on initial earnings guidance for this year. So the specific target on the backs of the two SFR REITs hasn't hurt them on a relative basis by nearly as much as you might expect. They did trade off based on the initial news. They traded off more based on the, you know, once the Senate came out with its, with its initial bill, they have traded up recently. Now part of that is just overall market uplift, but part of it may very well be because there is some rumblings that the House is pushing back against this seven year issue and what it might mean for the build to rent space. And if the House does push back and that gets taken out of whatever the final legislation looks like, then that could be a much more palatable situation for these two REITs and the market may be starting to sense that that's what the future holds. Obviously, you know, it's, it's a fool's game to try and predict what Congress is going to do. But it does feel like there is more, you know, kind of whispering about, you know, the House pushing back on that aspect in the Senate. And I think that's flowing through to the stocks a little bit.

[Podcast Host/Interviewer]

Jeff, follow up on the reasoning. I think what I've heard critics say about, about the restrictions, any kind of restrictions on build to rent and again, this is the purpose built rentals. I think the pushback is, hey, we're trying to build, you know, provide a bigger housing stock and when you build houses, you're adding to the housing stock. It's not restricting housing. And either even the, there is of course a theory that he's taking, buying existing homes to rent out could be removing housing stock. But this is, this is not going there. So am I right? I mean that's what, that's where the critics of any kind of restrictions are. That's what they're saying. Right.

[Jeff Langbaum]

And that is what the I think broader REIT investment community thought when this first came out was that, you know, this doesn't necessarily make sense. Not not only the build to rent, but just in general, if you make it less attractive to buy, to, to buy these home, to own these, these types of homes, then there's going to be less of them built and less new supply just makes overall home prices less affordable, not more affordable. And I definitely think that if the restriction on build to rent comes to fruition and less housing overall gets built, that just means that supply and demand, less supply is not the answer to improve affordability. You know, if you think about the overall housing stock and what makes for affordable housing, if it's, if, if, if home prices are not affordable in certain markets, renting a home instead is a very appealing option for some and some choose it instead because of flexibility advantages and maybe tax advantages. And, and clearly, you know, not, not necessarily needing all the capital upfront for, for a down payment. And so, you know, restricting the amount of homes, period is, is not, I, you know, I, I don't think, and I think the majority of the, you know, REIT investment community thinks is not the way to improve overall affordability.

[Podcast Host/Interviewer]

David, I want to ask you about lobbying.

[Michael Sasso]

Take us through one. What's happening at the federal level?

[Podcast Host/Interviewer]

How are the, what's happened behind the scenes at the federal level with institutional investors? What are they doing to try to either thwart this entirely or minimize the pain of the restrictions on overall purchases or just build to rent?

[David Howard]

Well, I think the industry is doing a lot of things right on Capitol Hill. I think Jeff made the comment earlier that the President's truth social Tweet back on January 7th caught virtually everybody in Washington D.C. off guard. Certainly caught everybody within the single family rental housing industry off guard. And so the industry really had to hustle to try to, if not get in front of this to at least engage. And so I think, you know, you move forward two, three, four months from where we were back in January, and I think the industry has actually accomplished a lot. There is widespread and genuine opposition to this bill in the House, which is where it currently sits, largely because of this seven year disposition provision. I can tell you I was on Capitol Hill last week. I've been spending a lot of time on Capitol Hill over the past few months. Just last week I met with a number of Republican House members, both those within leadership and those sort of more of the rank and file profile. And everybody had an opinion on this bill and everybody knew about this seven year disposition provision. Which again, I found, I found really interesting. It's not often the case that you have a bill like this where there is such widespread knowledge about what's actually in the bill. And I think that was part of the problem in the Senate. Things were so fast moving with this bill in the Senate that I actually think I know from having been in meetings with a number of Republican senators in the week or so leading up to the vote back in sort of early mid March, there were a lot of folks who didn't quite understand what was in the bill. The seven year disposition provision was actually added kind of the last minute and final vote coming out of The Senate was 89 to 10. I actually thought it would be higher than that. I knew it would pass, but I thought it would be more the sort of, you know, I thought the opposition vote would have 20, 25 no's, but just again, as a reflection of the fact that they're. There were a lot of Republicans in the Senate who again weren't aware of this disposition provision. And then once they found out about it, certainly weren't or certainly had questions about the bill. And so what that means for it now is it's sitting in the House. And I wouldn't say it's languishing. I think it's at a point where the House is trying to figure out how to move it forward. I think the House wants to get this bill done, but I think they want it to be done correctly. Not only are they concerned about this seven year disposition provision, but there are a couple of other things that the House really pushed for in its version of a housing bill that passed back in February that were not included in the Senate bill. Things having nothing to do with housing, things like digital currency. There were some community banking provisions that were left out of the Senate bill. So the House is concerned about what's in this bill. I think there's enough support for House leadership to mark up the bill to their liking. And I think it can pass the House. The problem is the Senate has, has shown very little if any willingness to negotiate on this bill. I had heard just last week, for example, Senator Warren said, look, this is not a negotiation. We passed a bill overwhelmingly. The bill is what it is. And so that's kind of where we are with the bill. It's in the House. I know that they want to move the bill. I think Republican leadership cares about housing. I know that members like French Hill, Mike Flood on the Financial Services Committee care about housing. They want to get this bill done. I'm just not sure that they feel good enough about its prospects moving forward when it goes back to the Senate to make it worth their effort. And so that's really where we are with this bill.

[Podcast Host/Interviewer]

It's kind of languishing then.

[David Howard]

For now it's languishing. It's also run up particularly this week. It's run up against a number of other higher order priorities in the House. There's a FISA bill which is about surveillance that an existing FISA bill that sunsets on Thursday that the House desperately wants to pass. So that's on the docket. Of course there's DHS and border funding which now has taken on a renewed sense of urgency as that's in front of the House. I know they want to move that. There's reconciliation 2.0 that is getting ready to get onto the Runway. I know the House wants to make some progress with that. So you know, I think over the next couple of weeks a lot of these higher order priorities are going to be addressed. They're going to flush out of the system and that's going to open up some time for the House to devote to things like the housing bill. I think kind of in this next tier down housing is pretty well positioned. So I don't think longer term this housing bill is going to languish. There's a chance that if the House ultimately feels like they can't get it through the Senate, they might put it on a shelf. But again, I think they're really going to put some time and effort into trying to get this bill done, including

[Podcast Host/Interviewer]

some kind of restrictions on investor bill to rent and well, I think the

[David Howard]

House version of this bill will include an investor ban. If for no other reason the administration feels strongly that they want investor restrictions included in the housing bill. That's not to say that that will indeed make it into the final bill, but my sense is because the President is so vested in this issue, there will be investor, institutional investor, that is restrictions to some degree. Whether the bill to rent disposition provision remains in the bill is less certain. I would even say very less certain. Personally, I think there's a very good chance that disposition provision either gets stripped out of the bill or gets significantly watered down again. There's widespread opposition to that provision in the bill and when you think about it, it doesn't really mesh with the overall intent of the bill. This is a bill intended to drive housing supply and this particular provision is nothing but anti supply. And so it really doesn't belong in this bill to Jeff's point, we need more housing in this country of all types, whether it's for sale housing, whether it's rental housing, either multifamily or single family. And here you have a provision that works to counter that. So it really has no place in this bill. And I think policymakers, legislators in the House are really starting to home in on that and realize that this provision really shouldn't be in there because it just candidly doesn't belong.

[Podcast Host/Interviewer]

Definitely turn to you. And is it true that a lot of, you know, a lot of the purchases that were done, were done? I mean, there was a giant wave after the great, great financial crisis. There was another giant wave around the pandemic. And I know, I've read and heard industry sources say this ship has sailed already. You know, these companies already slowed down their purchases.

[Commercial Voiceover 1]

It's too late.

[Podcast Host/Interviewer]

Even if there should have been action, it should have been three years ago or something. What are you hearing from your, your sources? Have they slowed down purchases anyways and it's just all kind of too little too late?

[Jeff Langbaum]

Yeah, they've slowed down purchases because they are economically driven and home prices are expensive and it's hard to make the numbers work if you're in the marketplace trying to buy homes and then generate a high enough return by renting those homes out. So the amount of homes that these companies have been able to purchase over the last couple years has been much lower than what they would have originally wanted. And what they did in, you know, the buildup as they were kind of growing their business and maturing and in fact that is why they both, both AMH and Invitation Homes more so the former adapted their model to become more build to rent developers or so AMH's model is primarily internal in house build to rent development and invitations homes was, was more so as almost like a takeout partner for the home builders that were building build to rent communities that they would then, you know, kind of purchase and take on as, as, as rental. As the rental landlord, there wasn't enough inventory available for purchase at prices that made sense for them to go out and grow their portfolios that way anymore. So, so that's, you know, why the build to rent provision became such a sticking point for them. You know, obviously both companies come from an acquisition background and if home prices were affordable enough, they would both be, you know, eager buyers, I think. But that's not the market that we're in right now. And so a ban on buying is less of an impact on their current business than it would have been Several years ago, the ban on building and buying built for rent homes, that's really the biggest sticking point at this point.

[Podcast Host/Interviewer]

David, one last question for you. Where I am in Atlanta, there was a flurry of activity at the state House. So there's stuff going on at state houses that could be very impactful for, for some big players and institutional owners. And I even hear that there were particularly Republican, but even some Democrat legislators that wanted, that heard Trump cracking down on in his industry. They wanted to be aligned with President Trump. And so we've seen a flurry of activity. Is the bigger risk or size of the risk in state houses versus the federal. I mean, how big of a concern is what's happening in state houses?

[David Howard]

So what is happening at the state level is very much a risk to the industry for sure. There were nearly 30 states this year this legislative cycle that introduced legislation that I say poses an existential risk to the industry. Meaning these are bills that either curb acquisitions by institutions or limit the number of homes that institutions can own. So these are serious legislative initiatives. And again, the fact that frankly, there have just been so many states that have now gotten into this game, I think it's concerning for the industry now. Again, I think when the industry engages and is able to tell its story in a way that is clear and concise and smart, they're effective because again, you have the data points, you can talk about the good that the industry is doing, the fact that we need more housing, all of that resonates and all of that has been effective. Nonetheless, there have been a lot of states out there that have started to introduce bills that are problematic for the industry. I think that's going to continue. What's interesting is this is not a new phenomenon. But in years past, this has really been limited to the blue states. And even there, just a handful of states, the Californias, the Oregons, the Washingtons. And I mean the problem there was always a bill would pass and it would sort of make its way into other blue states, right from California it would go to Nevada, Colorado, maybe some of the other states in the upper Midwest or New England, that sort of thing. But it was always sort of containable, if you will. A couple of years ago we started to see bills being introduced in places like Georgia and Florida, Texas, even Tennessee, North Carolina, certainly the more red and red leaning states. And I think that really caught the attention of the industry. I know when I was at nrhc, we spent an awful lot of time in places like Austin and Atlanta and Nashville meeting with Republican legislators governors talking to them about the industry, talking to them about these bills. So, you know, again, I think this is something that is here to stay. There's no state preemption in the federal bill, which means if the bill as it, if the road to housing bill as it currently is written passes and becomes law, there's nothing that prevents states from introducing and passing their own legislation focusing on institutional ownership. I will tell you, I believe if a bill passes in Washington, D.C. to limit the number of homes that institutions can either purchase or own, I think the impact will be on blue states. They will probably introduce legislation, continue to introduce legislation targeting institutions by saying the federal bill doesn't go far enough. So again, I think what you're going to see in blue states, should there be a bill that passes in Washington, D.C. those states are going to continue with a flurry of bills targeting institutional owners. I think the opposite will happen in the red states. I think again, in the red states in the southeast, Texas, middle part of the country, Arizona, I think you're going to see those states maybe take their foot off the pedal a little bit and say there's a bill that passed in Washington, D.C. to address this issue. Therefore we don't need to be as active. So again, I think what we're going to see should a bill pass, we're going to see more bills introduced in blue states, less bills introduced in red states. But the point is, I think this is a trend that's going to continue and I think it's something the industry is going to have to get its arms around.

[Michael Sasso]

We circle back.

[Podcast Host/Interviewer]

It's a good way to end. Circle back to the industry is facing challenge. It needs friends. It's got a victimization complex, if you will, I guess. Stay tuned. I really appreciate your time today.

[Jeff Langbaum]

Thanks, Michael.

[David Howard]

Thanks, Mike. Really appreciate it.

[Michael Sasso]

Bloomberg Intelligence is the investment research platform on the Bloomberg terminal with 500 analysts and strategists working across the globe and focused on all major markets. Our coverage includes over 2,000 equities and credits and we have outlooks on more than 90 industries and 100 market indices, currencies and commodities. To read more of Jeff Langbaum's research, please go to BI Reitngo on your terminal. Thank you and see you next time on this special edition of Votes and verdicts.

[David Howard]

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