A growing number of U.S. states are moving to curb institutional investors from buying up single-family homes, as housing shortages and affordability issues intensify. Lawmakers argue that large-scale investor activity is driving up home prices and squeezing out individual buyers, prompting a wave of proposed legislation aimed at leveling the playing field.
In Virginia, State Senator Glen Sturtevant has introduced a bill that would prohibit investment firms with assets over $50 million from acquiring single-family homes. The move comes in response to data showing that institutional investors accounted for 16% of all U.S. home purchases in Q2 2024, a trend many believe is worsening the housing supply crisis for middle-class families.
New York is taking a similar stance. Governor Kathy Hochul recently proposed a series of reforms to restrict hedge funds and private equity firms from aggressively acquiring homes. Her plan includes a mandatory 75-day waiting period before these entities can bid on properties, as well as removing tax advantages for purchases made above market value. Hochul emphasized the need to protect housing stock for “real families,” not just investment portfolios.
These efforts reflect growing bipartisan concern that Wall Street’s deep pockets are pricing everyday Americans out of homeownership. Critics argue that when large firms bulk-buy properties, they reduce available inventory and drive speculative price inflation—turning neighborhoods into profit centers rather than communities.
As housing affordability remains a national issue, these proposed restrictions could mark a turning point in how policymakers approach the role of institutional capital in residential real estate. Whether these measures gain traction across other states remains to be seen, but the message is clear: the fight to reclaim housing for individuals, not institutions, is gaining momentum.
