Highlights
- Trump announces immediate steps to ban large institutional investors from purchasing single-family homes.
- President to call on Congress to codify measure and unveil housing proposals at Davos World Economic Forum.
- Median US home sale price stands at $410,800 as affordability concerns persist despite election promises.
Donald Trump has announced his administration will move to ban large institutional investors from buying single-family homes in a bid to reduce house prices.
In a post on Truth Social, his social media platform, the US president said he would ask Congress to codify the measure and discuss additional housing and affordability proposals at the Davos World Economic Forum in Switzerland.
Shares of Blackstone, one of the largest private equity buyers, fell more than 5 per cent on Wednesday following the announcement. Builders FirstSource dropped over 5per cent, while Invitation Homes, which owns single-family homes, fell 6 per cent.
Trump capitalised on concerns around affordability during the 2024 presidential election campaign, pledging to rapidly reduce the cost of living for millions of Americans.
However, since he returned to power a year ago, concerns around prices and affordability have persisted as inflation remained stubbornly above typical levels.
Affordability pressures persist
House prices soared to record levels in the US during the pandemic before slipping back. The median sale price stood at $410,800 last year, according to the US Census Bureau.
Since the 2008 financial crisis led to widespread foreclosures, Wall Street investors including Blackstone and other private equity firms have bought tens of thousands of homes to rent out, becoming major landlords in certain markets.
Their role has drawn scrutiny from lawmakers in both parties, who blame the firms for pushing up renting and buying costs.
Senate minority leader Chuck Schumer, a Democrat, said on social media, "Senate Democrats tried to do this last year. Republicans blocked it."
"For a very long time, buying and owning a home was considered the pinnacle of the American Dream," Trump wrote, describing home purchases as "the reward for working hard, and doing the right thing."
"The American Dream is increasingly out of reach for far too many people, especially younger Americans," he added, blaming his predecessor Joe Biden for "Record High Inflation."
Daryl Fairweather, chief economist at Redfin, cautioned that banning large investors would likely see them replaced by mid-sized or smaller investors, not first-time home buyers.
The president is expected to attend January's annual meeting of the World Economic Forum and address the gathering in the Swiss Alps, where world leaders, executives and lobbyists convene each year.
The announcement comes as housing affordability remains a critical issue for American families, with younger generations particularly struggling to enter the property market amid elevated prices and persistent inflation concerns.
