Build-To-Rent Sell-Off Rule Is Stripped From Institutional Investors Ban as Trump Pushes for Landmark Housing Bill To Pass

House Republicans are aiming to move forward a bipartisan housing bill by cutting a requirement that build-to-rent institutional investors sell off their properties within seven years.

A new version of the 21st Century Road to Housing Act, completed Wednesday night, strips that requirement, which the Senate passed in its own version of the bill. It takes the form of a House resolution of concurrence with the Senate bill, and the House could consider the measure next week.

The sell-off rule had been a major sticking point in the bill in the House. It and the Senate passed different versions of the legislation, but only the Senate's contained the language. It's part of a larger ban on institutional investors from owning more than 350 homes in the housing market.

Research from Realtor.com® economist Jake Krimmel found that although overall investor activity is higher than it was a decade ago, large institutional investors—who have made more than 350 single-family home purchases since 2015—account for 1% of total single-family home purchases nationally. At their peak, they comprised of 16% of all investor purchase activity from 2015 to 2025.

Modifications

While the build-to-rent portion has been stripped from the bill, the rest of the ban is largely intact in the new House version of the bill. Those companies that already own more than 350 homes would be prohibited from purchasing more, with civil penalties for each violation, enforced by the Department of the Treasury.

There are a few other changes in the House version of the bill. It also removed the requirement that investors flipping homes to rent spend at least 15% of the purchase price on rehab work. Instead, they now must be in a state that makes them eligible for a mortgage.

In a Thursday morning statement, Rep. French Hill (R-Arkansas), Chair of the House Committee on Financial Services, said the updated bill still hits Congress' objective of expanding access to home ownership.

"Over the last couple of months, we’ve heard clear concerns from hundreds of members and stakeholders, and this bipartisan amendment reflects that feedback," Hill said.

"It cuts unnecessary barriers to new home construction, modernizes HUD programs, and allows banks to more freely deploy funding into their communities," Hill said. "We must get this right—and I am committed to working hard to do that.”

The two chambers must come to an agreement in bill language before it can move to the president's desk to be signed.

The 21st Century Road to Housing Act's passing through DC

President Donald Trump upped the criticism of investors in the housing market earlier this year and issued an executive order with some guardrails. But he pushed Congress to codify that ban in the housing bill, which contains dozens of other provisions aimed at cutting regulations and encouraging housing development.

But the Senate version of the bill went further than the House's with more provisions, and the bill stalled. Trump this week pushed the House to adopt the Senate's version as written.

Several large housing groups spoke up in opposition to the ban, including the National Association of Homebuilders. They said that build-to-rent homebuilders provide housing supply to a housing market that is fundamentally short on houses.

And those investors who buy and rehabilitate properties often have deeper pockets than a typical homeowner. So they have a role in the housing market by turning around vacant or abandoned properties, Edward Pinto, co-director of American Enterprise Institute's Housing Center, said on a recent call.

"They're homes that require substantial investment before they're livable. This is not cosmetic, they're rehabbing to neighborhood standard," Pinto said.

"Housing supply is not just about the number of homes that exist; it's how livable are they?"