US institutional landlord housing regulations

Following the passage of the 21st Century ROAD to Housing Act, large-scale institutional landlords in the United States have begun reducing their market share of single-family home purchases. Data indicates that firms owning more than 1,000 houses saw their market share drop from 2.5% in December 2025 to 1.3% in January 2026, as investors scale back ahead of the law’s January 7, 2027, effective date. While mega-investors have moved toward net selling, small investors owning between three and nine properties have remained active, accounting for approximately 63% of investor home purchases in 2025. Data from Griffin Funding indicates these small investors are currently competing in the same price ranges as first-time homebuyers.

The U.S. Treasury Department has released a 96-page proposal detailing the implementation of Section 1001 of the Act. The regulations target for-profit entities controlling 350 or more single-family homes but include specific exemptions for “build-to-rent,” “renovate-to-rent,” and homeownership programs. To qualify for the renovate-to-rent exception, investors must purchase structurally deficient homes where improvements total at least 15 percent of the purchase price, with a safe harbor requiring at least 10 percent of spending to be directed toward structural or core system elements. Treasury Secretary Scott Bessent stated the objective is to ensure American families have a fair opportunity to purchase homes by limiting the role of large institutional investors while avoiding disruptions to housing supply and construction.