US institutional landlords reduce home purchases amid new legislation

Large-scale institutional landlords in the United States have significantly reduced their share of single-family home purchases. According to data from Cotality, firms owning more than 1,000 houses saw their market share drop from 2.5% in December 2025 to 1.3% in January 2026. This decline follows the passage of the 21st Century ROAD to Housing Act, which prohibits entities controlling 350 or more single-family homes from acquiring additional properties, excluding specific build-to-rent and renovate-to-rent programs. While the law does not take effect until January 7, 2027, large and medium-sized investors began scaling back purchases months in advance.

In contrast, small investors—those owning between three and nine properties—have remained active. Realtor.com reported that small investors accounted for approximately 63% of investor home purchases in 2025, their highest share in over 15 years. While mega-investors have moved toward net selling, small investors were the only group to net add to their holdings in 2025, purchasing roughly 53,000 more homes than they sold. Data from Griffin Funding indicates these small investors are currently competing in the same price ranges as first-time homebuyers.