House Republicans have proposed major changes to the Senate's 21st Century ROAD to Housing Act, including the removal of the controversial requirement forcing institutional investors to sell build-to-rent (BTR) homes within seven years.
The updated House amendment maintains the broader ban on large institutional investors purchasing additional single-family homes but creates a clearer exemption for build-to-rent developments. Under the revised proposal, institutional investors that own 350 or more homes would still be restricted from expanding through traditional home purchases, but they would be allowed to build or acquire newly constructed rental homes and hold them indefinitely.
The original Senate bill, introduced by Senators Tim Scott and Elizabeth Warren and passed in March, aimed to limit institutional ownership of single-family housing. However, the inclusion of the seven-year selloff requirement raised concerns across the housing industry, with builders arguing it would discourage new rental housing development and reduce housing supply.
The House amendment also eases rules for renovate-to-rent projects. Instead of requiring investors to spend at least 15% of a home's purchase price on renovations, the revised version only requires the property to fall below local building or mortgage financing standards before improvements are made.
The debate comes amid growing political focus on institutional homeownership. Earlier this year, President Donald Trump called for restrictions on large institutional investors purchasing single-family homes while supporting exemptions for build-to-rent housing projects.
The House is expected to vote on the revised legislation next week. While the White House has reportedly supported removing the selloff provision privately, it remains unclear whether the Senate—particularly Senator Warren—will accept the changes.
Source: ResiClub