WASHINGTON — With affordability at top of mind for most voters, Congress is working through a housing bill that lawmakers hope will increase supply and lower costs by pushing large corporations out of the home-buying market.
U.S. Sen. Raphael Warnock, an Atlanta Democrat, worked alongside other members of the Senate Banking Committee, including Ohio Republican Sen. Bernie Moreno, to bar companies with more than 350 homes from purchasing any more or face steep fines.
“I know the housing affordability problem that we have in our state,” Warnock said. “I’ve seen it in my own family, among people I know, friends and church members. And a big part of that problem is private equity monopolizing too much of the marketplace.”
Warnock said he and Moreno worked together to get the provision inserted in the ROAD to Housing Act, a bipartisan package aimed at lowering housing costs across the nation.
The Atlanta Journal-Constitution’s 2023 investigative series “American Dream for Rent” found that corporations purchased more than 65,000 single-family homes over the past decade across the 11-county metro Atlanta region. These investor-owned homes were disproportionately found in Black communities and contributed to high prices and fees, frequent evictions, and substandard conditions, the AJC found.
U.S. Sen. Jon Ossoff responded by asking federal agencies to look into the issue. He cited data last year showing that corporations owned 30% of all single-family rental homes in metro Atlanta, with the number nearing 70% in Henry County.
Ossoff, D-Atlanta, is backing the Senate bill and citing Warnock’s provision. The legislation is expected to reach the floor for a vote next week.
“It’s very difficult for a Georgia family trying to purchase their first home to compete with these huge out-of-state companies who have massive resources and are buying up tens of thousands of single-family homes across metro Atlanta and across the state of Georgia,” Ossoff said.
The language restricting investor-owned rental housing has bipartisan support in the Senate and aligns with an executive order that President Donald Trump signed in January.
“Neighborhoods and communities once controlled by middle-class American families are now run by faraway corporate interests,” Trump’s order says. “People live in homes, not corporations.”
Republicans in Georgia’s General Assembly are pushing a state law with similar aims. State Sen. Greg Dolezal, a candidate for lieutenant governor, introduced a bill that would create a cap for corporate ownership at 500 homes in the state.
He said the bill would help families hoping to purchase homes no longer have to compete with large companies that can pay cash for homes, forego appraisals and contingencies and close quickly.
“What we’ve seen with these large institutional investors, is that they have bent the demand curve,” Dolezal, R-Cumming, said in a floor speech about his bill.
In Washington, the U.S. Senate bill is expected to pass in that chamber with bipartisan support, but there is some pushback in the House on Warnock’s provision stoked by the National Association of Home Builders, a powerful industry group.
The group said that Trump’s executive order exempts houses built for the purpose of serving as rental properties from the investor cap. However, the Senate’s bill requires corporations to sell off these homes within seven years.
“They exempt build-to-rent, but then they say if you do build-to-rent you have to divest of that property within seven years,” Ken Wingert, the builders’ association’s chief advocacy officer, told the Bloomberg wire service. “For most investors that is a level of uncertainty that we’ve heard they’re not willing to take.”
The vice chairman of the House Financial Services Committee, U.S. Rep. Bill Huizenga, told Politico he would not support the Senate bill unless Warnock’s provision is altered.
“I don’t think it works,” the Michigan Republican said, “and it’s not going to lower housing prices.”
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