WASHINGTON — President Donald Trump has signed a new executive order aimed at curbing the influence of large institutional investors in the U.S. housing market, a move the administration says will help make single-family homes more affordable and accessible for homebuyers.
Titled “Stopping Wall Street from Competing with Main Street Homebuyers,” the order directs federal agencies to issue guidance within 60 days to stop programs from approving, insuring, financing, securitizing or otherwise facilitating the purchase of single-family homes by large institutional investors that could otherwise be bought by individuals.
It also calls for first-look policies, enhanced disclosure requirements and anti-circumvention measures.
America’s Credit Unions Responds
“Home ownership has long been a core tenant of achieving the American dream, and credit unions are trusted partners in helping their members obtain affordable loans to do so,” Scott Simpson, America’s Credit Unions president/CEO., said in a statement. “We’ve advocated for policies that will enhance credit unions’ ability to participate in federal home loan programs, and we will continue to engage the Administration and housing regulators to ensure credit unions are part of this solution.”
Terms Need to be Defined
The Treasury Department has 30 days to define key terms such as “large institutional investor” and “single-family homes,” and the Justice Department and Federal Trade Commission will scrutinize acquisitions by big firms for potential anti-competitive behavior, according to the White House.
The Housing and Urban Development Department has been tasked with identifying institutional involvement in federal housing assistance programs.
White House officials said the order prioritizes families over Wall Street and sets the stage for proposed legislation to codify the restrictions. Critics, however, argue that institutional ownership represents a relatively small share of the market and that supply constraints, not investor activity, are the main driver of rising home costs, Reuters reported.
As the CU Daily has reported, the action follows earlier Trump directives, including a plan for Fannie Mae and Freddie Mac to buy $200 billion in mortgage bonds to lower borrowing costs, and comes as the administration prepares housing policy announcements at the World Economic Forum in Davos, Reuters added,
