The Senate moved closer Wednesday to passing a bipartisan housing package aimed at increasing affordable housing supply, though a Trump-supported provision banning institutional investors from purchasing single-family homes faces pushback. The bill cleared a key procedural vote, setting up a likely final Senate vote before lawmakers adjourn on Thursday.
Bipartisan Senate Effort Targets Housing Affordability
The Housing for the 21st Century Act, which passed the House last month 390-9, includes broad measures designed to boost affordable housing options for first-time buyers and lower-income Americans. Senators Tim Scott (R-S.C.) and Elizabeth Warren (D-Mass.), chair and top Democrat of the Senate Banking, Housing, and Urban Affairs Committee, respectively, jointly advanced the bill with modifications in the Senate.
Scott highlighted the bipartisan cooperation, stating to CNBC that agreement among President Trump, Democrats, and Republicans demonstrates the potential to address housing issues when partisan politics are set aside.
Institutional Investor Ban Sparks Controversy
A centerpiece provision added at President Trump’s urging would ban large institutional investors, including hedge funds and corporations, from buying single-family homes. This provision also includes a requirement for entities exceeding a threshold of ownership to divest properties within seven years.
The Trump administration previously issued an executive order endorsing this ban, which Trump has urged Congress to codify to prioritize homeownership for individuals rather than corporations.
However, some Senate Democrats and industry groups warn the language is overly broad and could disrupt the build-to-rent housing sector. Senator Brian Schatz (D-Hawaii) criticized the provision on the Senate floor, arguing that defining institutional investors as anyone owning more than 350 single-family or duplex rental units would force many legitimate landlords to sell their properties unnecessarily.
Industry representatives sent a joint letter to Scott and Warren stating the seven-year divestiture clause could “effectively shut down build-to-rent development,” reducing rental housing options and supply.
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