Can empowering small investors strengthen America’s housing supply?

If you follow the headlines alone, you might conclude that institutional investors and private equity firms are dominating America’s housing market, leaving individual investors with less access to supply. Federal survey data tell a more nuanced story: Individual investors own most of the nation’s rental properties, even though entity-owned properties, likely including institutional investors, account for a larger share of rental units. While institutional capital plays an important role in large commercial assets and multifamily communities, most of the nation’s rental properties are owned by individuals and small business owners. Every day, Main Street investors decide whether to purchase another property, renovate an aging rental, refinance, hold or sell. Collectively, those decisions shape housing quality, neighborhood stability and rental supply. The 2024 Rental Housing Finance Survey, sponsored by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau, estimates that individual investors own approximately 59% of the nation’s rental properties, representing approximately 32% of its rental units. LLPs, LPs and LLCs own approximately 21% of rental proper...