Trump takes on private equity with new housing plan
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Illustration: Maura Losch/Axios
President Trump's latest command economy performance is aimed at large institutional investors in single-family homes, pledging to block them from buying more.
Why it matters: This is his first public break with private equity since returning to office, and a rare time when he might find common ground with Democrats.
- It's also a direct shot at Blackstone, whose CEO Steve Schwarzman is a longtime Trump supporter.
State of play: Trump is expected to lay out details of his plan later this month during a speech at the World Economic Forum in Davos, and would then need Congress to take up the mantle.
- We've not yet heard any details on how "large institutional investor" would be defined, nor if Trump's plan would include required divestiture of existing assets.
The big picture: Housing costs are a major driver of America's affordability problems — the ones Trump refers to as a "hoax" — but institutional investors own relatively few single-family homes.
- Private equity first entered the market after the financial crisis, led by Blackstone, buying up distressed supply.
- Since then, its interest has ebbed and flowed. For example, Blackstone says that last year it sold more single-family homes than it purchased and that it's been a "net seller of homes over the last decade."
- Brookings estimated in late 2023 that around 3% of America's single-family homes were owned by "large institutional investors," noting that they were more active in the multifamily housing space.
- It added that such ownership was concentrated in select geographies, where the market shares were therefore higher (up to 12% in some cases). Examples included Charlotte, Indianapolis, and Tampa.
Look ahead: It's unclear how institutional investors will react, although public equity investors hammered some of their stock prices yesterday.
- Do they just keep buying when opportunities emerge, expecting Trump's effort to stall? Do they pause? Do they begin selling, worried about becoming distressed sellers themselves?
The bottom line: Few private equity firms own homes, either to flip or to rent. But almost all of them are invested in sectors that impact affordability — so they may not want to get too comfortable.
