Oregon, Washington lawmakers want to ban hedge funds from buying single-family homes
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PORTLAND, Ore. (KOIN) — Pacific Northwest lawmakers are leading the charge to prohibit hedge funds from owning residential homes during the nation’s ongoing housing crisis.
The End Hedge Fund Control of American Homes Act of 2023, introduced by Oregon Sen. Jeff Merkley and Washington Rep. Adam Smith, would force hedge funds to sell at least 10% of the single-family homes they own for the next 10 years. After 10 years, investors would be fully banned from acquiring single-family residences.
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According to Sen. Merkley’s Office, hedge funds and private equity firms’ history of taking over residential housing dates back to the 2008 financial crisis — when many investors took advantage of the foreclosed homes on the market.
The state official reported that no single firm or hedge fund owned more than 1,000 single-family rentals in 2011. But by June 2022, the Urban Institute projected that major hedge funds and investors owned around 574,000 units.
In a statement, Rep. Smith added that his father was able to buy a $15,000 home with his baggage handler salary in 1971 and that same home would cost almost $500,000 in the modern-day market.
“The housing in our neighborhoods should be homes for people, not profit centers for Wall Street,” Sen. Merkley added. “It’s time for Congress to put in place commonsense guardrails that ensure all families have a fair chance to buy or rent a decent home in their community at a price they can afford.”
A number of national organizations, including the National Housing Law Project and the National Housing Resource Center, and the Center for Popular Democracy, have backed the bicameral act.
In 2021, Merkley also introduced the Affordable Housing Opportunities Made Equitable Act.
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The senator said that the act would reduce housing costs, develop an emergency housing program and address the country’s historically racist federal housing policies.
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