As experts in the mortgage market, we at Maciel Mortgage understand how important it is for families to achieve the dream of homeownership. Unfortunately, many are finding this dream increasingly difficult to attain due to a variety of challenges, including competition from large investors like hedge funds. Here’s a breakdown of a new legislative proposal aimed at addressing this issue:

What’s the Issue?

• Housing Affordability Crisis: Despite a stronger job market, many American families struggle to buy homes. One reason is the competition from hedge funds and other investors who buy homes in bulk, often outbidding individual buyers.
• Past Government Sales: Following the 2008 crisis, the government sold large numbers of foreclosed homes in bulk to investors, sidelining ordinary families and non-profits.
• Increasing Investor Purchases: Data shows a significant spike in homes bought by large investors, with notable examples in cities like Atlanta and Phoenix.

Who’s Being Targeted?

• Vulnerable Communities: Studies have found that these investors often target neighborhoods with higher populations of Black families and single mothers, exacerbating housing inequalities.

The Proposal: “End Hedge Fund Control of American Homes Act”

• Ban on Hedge Funds Owning Homes: The legislation proposes banning hedge funds and similar entities from owning large quantities of single-family homes. A $20,000 tax penalty would be imposed for each home owned beyond a set limit of 100.
• Support for Families: The collected taxes would fund down-payment assistance programs, making homeownership more accessible.
• Gradual Exit for Investors: Hedge funds would be required to sell off a portion of their homes each year exclusively to families, not businesses or other corporations.
• Focus on Families: The act ensures that only families can buy these homes, promoting residential stability.

How Maciel Mortgage Can Help: As always, our team is here to guide you through the changing landscape of the mortgage market. We believe this legislation, if passed, could present new opportunities for families looking to buy homes. We’re committed to keeping you informed and helping you navigate these opportunities to make your dream of homeownership a reality.