New bill aims to eliminate government handouts to Wall Street landlords

The Private Equity Stakeholder Project is proud to support the American Homeownership Act, a bill introduced by Senators Elizabeth Warren and Jeff Merkley. The proposed legislation would end tax breaks and other benefits for Wall Street landlords who purchase housing, redirect those savings into initiatives to increase American housing supply, and increase antitrust monitoring of housing acquisitions. 

“For too long, Wall Street landlords have been able to have their cake and eat it too: enjoying lucrative tax breaks for buying up rental properties then raking in profits by hiking rents and imposing junk fees on hard-working American tenants,” said PESP director of policy Chris Noble. “The federal government shouldn’t be giving handouts to Wall Street landlords or bailing out private equity firms while Americans everywhere struggle to pay rent. The American Homeownership Act is an essential step toward preventing private equity and other corporate landlords from profiting from the housing affordability crisis.”

Private equity landlords and other such corporate owners of housing supply are notorious for their substandard treatment of their tenants, including egregious rent hikes, deferred maintenance, expensive junk fees, unjust evictions, and even health violations that could endanger residents.

The American Homeownership Act comes amidst a flurry of federal policy initiatives aimed at ameliorating the ongoing housing affordability crisis in the U.S. In January, President Trump issued an executive order to ban institutional investors from purchasing single-family housing, although the order contains significant loopholes for the build-to-rent industry popular with private equity landlords. Next week, Senator Bernie Moreno is anticipated to introduce legislation codifying that ban, an early draft of which had many carve-outs for corporate landlords. 

The American Homeownership Act represents a more robust approach to the housing affordability crisis thanks to its elimination of handouts to corporate landlords. Reclaiming resources from Wall Street landlords is more effective in reining in corporate profiteering from the housing crisis. 

Other policy proposals could also help address the bad behavior of private equity landlords, including:

• A federal landlord complaint database to promote transparency and accountability among corporate landlords
• Just cause eviction protections to prevent arbitrary and/or unjust evictions
• Landlord licensing to ensure that investor-owned housing is fit for habitation, and that the landlord is in good standing to conduct business
• Federal rent stabilization policies to limit a tenant’s rent increase to a specific dollar amount and/or the percentage the rent can be increased after the tenant vacates the premises.