New Law Caps PE Single-Family Home Buys Starting Friday

Proponents argue the rule will cool bidding wars in starter-home neighborhoods where cash-rich funds have outbid families. The National Association of Realtors estimates institutional buyers accounted for roughly 15% of single-family home sales in 2024, up from 5% a decade earlier.

Opponents say the cap will reduce liquidity in the rental market. Private equity-backed landlords own about 600,000 single-family rental homes nationwide, according to the Urban Institute. A trade group representing the firms warned the law could push rents higher by limiting supply of professionally managed properties.

The Treasury Department is set to release compliance guidelines by Aug. 1. Firms that exceed the cap face fines of up to $50,000 per violation.