Home is where the heart is, but not where the institutional investors are.
At least, that’s President Donald Trump’s proposed plan. In a post on Truth Social, he said he’s “immediately” taking steps to ban large institutional investors from buying single-family homes.
“People live in homes, not corporations,” Trump wrote.
It was one of two attacks the president issued on the business world. The other targeted a group familiar with crosshairs: defense contractors.
Trump said he would “not permit” defense companies to issue dividends or do stock buybacks until they sped up production. He also criticized industry executives’ “exorbitant and unjustifiable” compensation packages.
Blackstone, a large institutional investor in residential real estate, and defense contractors Northrop Grumman and Raytheon Technologies were among the companies that saw their share prices immediately drop following the posts.
For Trump, it’s in line with a new form of capitalism he’s ushered in during his second term. One with more government involvement in the private sector, including taking individual stakes in companies, as BI’s Emily Stewart previously covered. (You can also see my ugly mug discussing the idea here.)
It’s a topic we’re focusing on this year at BI with our series, “The Future of Capitalism.”
The intention behind Trump’s latest attacks seems squarely focused on his biggest opponent these days: affordability.
From houses to groceries to everything in between, rising prices have been a real thorn in Trump’s side. The president has maintained he inherited these problems from his predecessor, but that hasn’t softened the blow for some Americans.
On paper, going after institutional investors in the housing market is the perfect antidote. The real-estate market has been a mess the past few years, and frustrated home buyers love to blame Wall Street.
In reality, it’s not that clear-cut, as BI’s James Rodriguez has previously reported.
One analysis from October 2023 found investors with at least 1,000 units in their portfolio owned just 0.73% of all single-family homes in the US. However, regions like the southeast have a more concentrated number of institutional investors.
Still, the housing shortage is more likely the reason you can’t find, or afford, your dream home. Trump didn’t mention anything about institutional investors having to sell the houses they already own. And even if you want to, you can’t really yell at boomers to start selling theirs.
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