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Biden Targets Institutional Homebuying with New Executive Order

  //house-home.news-articles.net/content/2026/02/2 .. utional-homebuying-with-new-executive-order.html
  Published in House and Home on Friday, February 20th 2026 at 17:44 GMT by WTVT
      Locales: District of Columbia, Pennsylvania, Illinois, Arizona, UNITED STATES

Washington D.C. - February 20, 2026 - President Biden today signed an executive order intensifying the administration's focus on housing affordability and accessibility, specifically targeting the growing trend of institutional investors dominating the single-family home market. The order, announced this afternoon, instructs the Department of Housing and Urban Development (HUD) to develop and propose new regulations aimed at curbing the ability of large entities - including hedge funds, private equity firms, and real estate investment trusts - to purchase existing single-family homes.

This action represents a significant escalation in the administration's strategy to address the nationwide housing crisis, which has seen prices soar and homeownership become increasingly out of reach for many Americans, particularly first-time buyers. The underlying rationale is that the surge in institutional buying has artificially inflated prices, reduced the available housing stock for individuals and families, and contributed to a competitive market that favors those with substantial capital.

According to White House estimates from 2024, institutional investors accounted for approximately 25% of all single-family home purchases - a figure that has raised concerns among policymakers and housing advocates. This percentage represents a dramatic increase from pre-pandemic levels, driven in part by low interest rates and a perceived opportunity to capitalize on rising property values. These investors often purchase homes with cash, outbidding individual buyers and further exacerbating the affordability crisis. While the exact methodology for calculating this figure has been debated by industry groups, the trend of increased institutional investment is widely acknowledged.

The executive order doesn't constitute an outright ban on institutional homebuying. Instead, it directs HUD to explore mechanisms to limit the practice, potentially through measures like prioritizing individual homebuyers in bidding wars, implementing stricter lending requirements for institutional investors, or establishing caps on the number of homes these entities can acquire in specific markets. The specifics of these proposed rules will be crucial in determining the order's ultimate impact. HUD is expected to release a preliminary draft of the regulations within the next 90 days, followed by a period of public comment.

Beyond Limiting Purchases: A Holistic Approach to Affordability

The White House emphasizes that this executive order is just one component of a broader, multi-pronged strategy to tackle housing affordability. Other key initiatives include efforts to increase the overall housing supply through zoning reform, incentivizing construction of affordable housing units, and streamlining the permitting process. Simultaneously, the administration is pursuing measures to reduce mortgage costs, including exploring options for expanding access to down payment assistance programs and lowering interest rates (though the latter is heavily influenced by the Federal Reserve).

"We understand that addressing the housing crisis requires a comprehensive solution," stated a senior administration official during a press briefing. "Limiting institutional investment is an important step, but it won't solve the problem on its own. We need to build more homes, make homeownership more accessible, and create a more equitable housing market for all Americans."

Industry Reaction and Potential Challenges

The response from industry experts has been predictably mixed. Some analysts argue that the executive order is a misguided attempt to address a complex problem, and that limiting institutional investment could actually constrain housing supply by reducing the capital available for renovations and property maintenance. They point out that institutional investors often play a role in revitalizing neighborhoods and providing rental housing options. Others express concern about the potential for unintended consequences, such as driving up prices in the remaining available housing stock.

"While we share the administration's goal of increasing housing affordability, we believe that this approach is overly simplistic and could have negative repercussions," said a spokesperson for the National Association of Realtors (NAR). "We need to focus on addressing the root causes of the housing shortage, such as restrictive zoning laws and labor shortages in the construction industry."

Conversely, housing advocacy groups have largely praised the executive order, viewing it as a long-overdue step towards leveling the playing field for individual homebuyers. They argue that institutional investors have unfairly benefited from the housing boom at the expense of ordinary families. The success of this order will depend on the detail within the proposed rules and the ability to enforce them effectively. There is already discussion around potential legal challenges from industry groups, claiming the order oversteps federal authority or unfairly discriminates against certain investors. The next few months will be critical as HUD develops and implements these new regulations, and as the broader housing market continues to evolve.