Trump issues executive order to limit big investors from buying single-family homes to rent

President Donald Trump issued an executive order on Tuesday, Jan. 20, for the purposes of “Stopping Wall Street From Competing With Main Street Homebuyers.”

“Buying and owning a home has long been considered the pinnacle of the American dream and a way for families to invest and build lifetime wealth,” the executive order states. “But because of the recent high inflation and interest rates caused by the previous administration, that American dream has been increasingly out of reach for too many of our citizens, especially first-time homebuyers.”

Additionally, Trump said there’s a growing number of single-family homes “concentrated in certain communities” that have been purchased by big time investors, and in turn, “crowding out families seeking to buy homes.”

“Hardworking young families cannot effectively compete for starter homes with Wall Street firms and their vast resources,” the executive order states. “Neighborhoods and communities once controlled by middle-class American families are now run by faraway corporate interests. People live in homes, not corporations. My Administration will take decisive action to stop Wall Street from treating America’s neighborhoods like a trading floor and empower American families to own their homes.”

It’s the “policy of my Administration,” Trump said, that large investors shouldn’t buy single-family homes that could otherwise be purchased by actual families. 

The executive order by Trump said his Secretary of Agriculture, Secretary of Housing and Urban Development, Secretary of Veterans Affairs, Administrator of General Services and the Director of the Federal Housing Finance Agency should work to prevent agencies and government sponsored enterprises from: providing for, approving, insuring, guaranteeing, securitizing or facilitating acquisitions by large investors of single-family homes; disposing of federal assets that transfer ownership of single-family homes to large investors; and promote sales to individual owners through “anti-circumvention provisions, first-look policies and disclosure requirements.” 

Trump said in the executive order the Secretary of Treasury shall review the rules and guidelines related to large investors acquiring or holding single-family homes and consider revising them, in accordance with the law, if appropriate.

“The Attorney General and the Chairman of the Federal Trade Commission shall review substantial acquisitions, including series of acquisitions, by large institutional investors of single-family homes in local single-family housing markets for anti-competitive effects and prioritize enforcement of the antitrust laws, as appropriate, against coordinated vacancy and pricing strategies by large institutional investors in local single-family home rental markets,” Trump added in the executive order. “The Secretary of Housing and Urban Development shall, to the maximum extent permitted by law, require owners and managing agents of single-family home rentals participating in Federal housing assistance programs to disclose to the Department of Housing and Urban Development direct or indirect owners, managers, or affiliates, including changes in ownership or control of single-family rentals, to the extent necessary to determine any involvement of large institutional investors.”

Trump ordered the Deputy Chief of Staff for Legislative, Political and Public Affairs to “prepare a legislative recommendation to codify” what he laid out in the executive order. 

Local impact

For nearly a decade now, the housing market in the Minocqua area has been impacted by the short-term rental market. 

“Ever since the state legislator in 2017 or 2018 took away municipalities’ authority to limit short-term rentals in single-family neighborhoods, there’s been a trend of absentee owner-investors purchasing individual or multiple single-family residences because they can be used as weekly rentals or short-term rentals,” Minocqua town chairman Mark Hartzheim said. “So that is a fact. I don’t know if I would say big corporations are doing it, but certainly there’s a lot of absentee owner-investors who have picked up individual or multiple homes for the purpose of renting them out as accommodations.”

Every time that happens, he said, it takes a single-family home off the market and potentially prevents a working family in the community from living there. 

“These single-family rentals aren’t just on the water,” Hartzheim added. “They’re snapping up modest ranch homes off water … it doesn’t matter what the residential property is. People are snapping them up to turn them into short-term rentals and make a quick buck.”

Even mobile homes are being bought for short-term rental purposes, he noted. 

“It’s not just luxury homes that are being used for this, it’s also modest, lower-income housing that’s being taken off the market for people to make a buck off short-term rentals,” Hartzheim said. “So it’s making an impact, no doubt.”

He said more people want to be in the Northwoods more frequently ever since the Covid-19 pandemic.

“On the one hand, that’s a good thing,” Hartzheim said. “But on the other hand, we can’t take care of the people we already have here right now. There’s not enough labor to support it — the demand for services. So you add in the homes, especially in single-family neighborhoods, being purchased for short-term rental, it really has a detrimental affect on the housing situation up here.”

Trevor Greene may be reached via email at [email protected].