On Wednesday, President Donald Trump said he would take steps to ban large institutional investors from buying single-family homes. Real estate-related stocks reacted sharply downward.
Trump expressed his view on homeownership and “the American Dream” in a post on Truth Social.
"For a very long time, buying and owning a home was considered the pinnacle of the American Dream. It was the reward for working hard, and doing the right thing, but now … that American Dream is increasingly out of reach for far too many people, especially younger Americans," Trump said.
"It is for that reason, and much more, that I am immediately taking steps to ban large institutional investors from buying more single-family homes, and I will be calling on Congress to codify it. People live in homes, not corporations," he added.
The post signaled an aggressive shift in federal policy aimed at curbing the influence of institutional investors in the single-family residential market, causing real estate and housing-linked stocks to crater.
The administration's move specifically targets firms that have spent the last decade accumulating vast portfolios of American homes, often outbidding individual families with all-cash offers. Trump's message was clear: the era of corporate landlords dominating the housing supply is over.
Market Reaction
The market reaction was swift and brutal. Shares of Invitation Homes, Inc. (NYSE:INVH), the nation's largest owner of single-family rentals, plunged 6% as investors weighed the possibility of forced liquidations.
Blackstone, Inc. (NYSE:BX), which has invested billions into the sector, also fell nearly 6% as the policy shift threatens its massive real estate returns.
Tech-driven real estate companies like Opendoor Technologies, Inc. (NASDAQ:OPEN) were not spared as speculation and uncertainty surrounding the liquidity of the housing market swirled.
Homebuilders, including Toll Brothers (NYSE:TOL) Lennar Corp. (NYSE:LEN) and KB Home (NYSE:KBH), also took a hit.
Even construction-adjacent companies like Builders FirstSource (BLDR) faced downward pressure, as the industry braces for a volatile transition period.
Looking Ahead
In the same social media post, Trump also said that he will discuss "further housing and affordability proposals" at the World Economic Forum meeting in Davos, Switzerland in two weeks.
For now, the “Wall Street Landlord” trade is in full retreat as Trump attempts to pivot the nation's housing policy away from institutional profits and back to Main Street ownership.
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