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In 2020, Raysall Wiggins decided she no longer wanted to rent a home in the Houston neighborhood where she grew up. She wanted to buy.

“I wanted to have something of my own, something that I could eventually pass down to my children,” said Wiggins, who has two teenage sons. “My parents never had that, and I wanted something different for my own children.”

Wiggins, who works in health care, put in multiple offers on homes in Houston’s Acres Home neighborhood. But more times than not, she was beaten not by another family, but by an investor or company, her real estate agent said.

“It’s devastating to continuously go through the same thing, for a person to constantly be told, ‘no’ or ‘we didn’t get it,’” Wiggins said. “It’s a complete letdown.”

President Donald Trump highlighted Wiggins’ story as he pressed lawmakers at his State of the Union address to bar so-called institutional investors, large corporations that buy homes, as well as investors big and small, from purchasing single-family homes.

Trump blamed investors for “stealing away her American Dream.”

Homeownership is viewed as the most accessible way for Americans to build wealth. By that measure, the idea of corporations owning homes is offensive to Americans, said Daryl Fairweather, chief economist at Redfin, an online real estate brokerage. Going after them carries populist appeal.

But, she and other housing economists said, such a prohibition does not attack the root of the nation’s housing problems.

“Declaring a ban on institutional investors works as a political talking point,” Fairweather said. “It works in terms of it emotionally resonating with people who understand the problem but don’t necessarily understand what the right solution is. The real solution, which is to build more homes in the places that people most want to live, is much harder for the President to achieve.”

Republicans, including Trump, and Democrats, including Sens. Bernie Sanders and Elizabeth Warren, have sought to cast blame on Wall Street and other kinds of investors driving up home prices and making it too hard for would-be first-time homebuyers out of the market.

They’ve sought ways to give first-time homebuyers a leg up in the housing market. Trump signed an executive order in January aimed at discouraging federal agencies from facilitating sales of homes to large institutional investors. Trump called on Congress during his State of the Union address to make that ban permanent. Senators are expected to vote on a bill this month that would limit firms from owning more than 350 single-family homes.

Texas officials, too, have shown an appetite — including Gov. Greg Abbott and state Rep. Gina Hinojosa, an Austin Democrat challenging Abbott in this year’s gubernatorial race — to curb investors from buying up too many homes.

Kicking Wall Street out of the housing market, housing economists argue, wouldn’t blunt the country’s affordability problems — and could make the problem worse.

For one, estimates show large institutional investors own only a small percentage of the nation’s stock of single-family homes — between 1% and 3%. Investors have pulled back considerably since the height of their activity during the pandemic and are now selling more homes than they buy. Those homes aren’t just sitting there — they’re rented to tenants who may not be able to afford to purchase them.

“When you ban institutional investors, you’re potentially banning the people who might not otherwise have access to local schools in single-family neighborhoods or other amenities in those neighborhoods,” Fairweather said. “That reinforces income segregation and racial segregation.”

The primary driver of the nation’s high housing costs, experts have argued, is a deep shortage of homes to buy or rent. By various tallies, the nation is short millions of housing units. Texas, in particular, needs 319,500 homes of all kinds, according to one oft-cited estimate. Banning institutional investors from buying homes, or at least making it more difficult for them to do so, would do nothing to create more homes.

“If you stop them from buying, will it result in more housing construction? No,” said Edward Pinto, co-director of the AEI Housing Center at the conservative American Enterprise Institute.

Low rates led to rush of investors

Institutional homebuying took off during the COVID-19 pandemic as low-interest rates and high housing demand made owning a home an attractive investment. At one point, they bought one in nearly every 10 homes sold nationwide, according to figures provided by ATTOM Data Solutions, which tracks property transactions and real estate data.

Investors bought even more homes in Texas during the same period. Institutional investors bought 68,482 homes across the state in 2021, or 14.2% of all homes sold in Texas that year, ATTOM figures show. ATTOM defines institutional investor purchases as “residential property sales to non-lending entities that purchased at least 10 properties in a calendar year.” In 2019, such investors bought 26,735 — some 7% of homes sold in Texas that year.

The Dallas-Fort Worth and Austin regions emerged as particular hot spots for investor homebuying in 2021 and 2022.

Institutional buyers significantly ramped up their presence in the Houston region’s home-buying market just as Wiggins began her hunt for a home. In 2019, institutional investors bought fewer than 4,500 homes in the Houston area, ATTOM data show, some 5.3% of all homes sold there that year. Two years later, they bought more than 15,000 — and accounted for more than 13% of sales.

With that influx came a flurry of anecdotes of would-be homebuyers getting outbid by one corporation or another.

Kim Gartner, a Fort Worth real estate agent, said it was common during the pandemic for investors of all sizes to beat out her clients for homes. Often, corporate buyers, she said. Some buyers stuck it out, putting in offers on multiple homes before finally securing one, Gartner said. Others gave up.

“They got frustrated and didn’t feel like they could compete, so they just kind of decided to hold off,” said Gartner, who is secretary and treasurer at the Greater Fort Worth Realtors Association.

There’s no agreed-upon definition of what constitutes an institutional investor. A corporation that buys a single-family home could be a major company that owns tens of thousands of homes or a mom-and-pop landlord that owns one or two homes.

Whatever their size, investors own very few of the state’s single-family housing stock, estimates show.

Less than 1% of Texas’ single-family housing stock is owned by corporations that own 100 units or more as of June 2025, according to estimates from the American Enterprise Institute. Smaller landlords who own between two and nine properties own about 13.2% of the state’s single-family homes, while owners with 10 to 99 homes hold about 1.8% of the stock.

It’s not clear whether institutional investors ultimately have any effect on home prices, housing policy wonks said.

A home renovated by an institutional investor will likely rent for more than it did before that investor bought it, said Daniel Oney, research director at the Texas Real Estate Research Center. But he said he hasn’t seen convincing evidence that investors have driven the state’s housing prices upward.

“We see a role for [institutional investors], and regulating them may not actually have that big of an impact on home prices,” Oney said.

But tales of would-be buyers’ struggles to purchase a home when matched against a Goliath investor have garnered sympathy from Texas lawmakers, who in 2023 sent a bill to Abbott’s desk compelling the Texas Real Estate Research Center at Texas A&M University to keep track of institutional buyers’ activity in the state’s housing market.

Abbott vetoed the bill among a slew of bills he vetoed to try to force Republican legislators at the time to reach a deal to cut property taxes.

The following year, he called on state lawmakers to rein in Wall Street homebuying when they convened in 2025.

“I strongly support free markets,” Abbott wrote in a post on X. “But this corporate large-scale buying of residential homes seems to be distorting the market and making it harder for the average Texan to purchase a home.”

Lawmakers left Austin last year without touching the matter. Hinojosa, who has pushed bills targeting investors, reintroduced a similar measure to track investor activity as well as one to prevent them from buying a home for at least 30 days after it first hit the market. Neither went anywhere.

“Making housing affordable in Texas starts with holding private equity and institutional buyers accountable,” Hinojosa wrote in a Facebook post in December. “As governor, I will do just that — make it easier for working Texans to buy a home.

An Abbott representative did not directly answer questions about the governor’s stance on banning institutional investors, referring a reporter to his past comments. Hinojosa’s campaign did not return requests for comment.

A slight edge

The U.S. Senate this week advanced a bill aimed at easing the nation’s housing affordability crunch. Within that bill is a provision banning large investors from owning more than 350 single-family homes. That doesn’t count homes in build-to-rent developments, subdivisions of single-family homes intended for tenants.

The bill includes a provision that requires companies to sell those build-to-rent homes within seven years, Bloomberg News reported. Builders and a coalition of housing advocates, including the group Dallas Neighbors for Housing, have called on lawmakers to strike that language from the bill.

Would-be homebuyers might gain a slight competitive edge should officials pass laws to force those homes back onto the for-sale market, some experts acknowledged, because supply would be increased. But that injection of supply wouldn’t be big enough to put a real dent in home prices, they argue. What’s more is that supply infusion in the for-sale market would bite into the country’s rental supply, which plays a role in the country’s overall housing ecosystem. Rents could go up as a result.

Depending on the scope of whatever law gets passed, an institutional investor may wind up selling their home to a smaller investor, not a homebuyer who wants to live there, housing experts noted.

Instead of targeting Wall Street, housing experts said officials should focus on ways to allow more homes to be built like speeding up local permitting processes, allowing smaller homes on smaller lots and a wider array of housing types like duplexes, townhomes and smaller apartment buildings in places that now only allow single-family homes. Housing advocates are fond of noting that firms with a large portfolio of single-family homes have said that they’re less profitable in places that allow more homes to be built.

The power to enact those kinds of changes largely rests with states and cities, not the federal government — and those kinds of changes often face pushback from existing homeowners. But policymakers at the federal level could pass measures encouraging states and local governments to allow more homes to be built, housing experts said.

Texas lawmakers enacted several measures, which Abbott signed and Hinojosa voted for, to boost the state’s housing supply last year like allowing smaller homes on smaller lots in some places and apartments in commercial areas in the state’s biggest cities. Austin officials, too, have relaxed a slew of local regulations in recent years to allow more homes to be built, but few other major Texas cities have.

There are additional solutions.

When Wiggins finally purchased her home in 2023, she bought it through the Harris County Community Land Trust, which uses a method housing advocates have touted to help lower-income families secure affordable homeownership. Under the program, Wiggins owns the house but the trust owns the land underneath, which lowers the overall cost of the home — an arrangement Wiggins said she has mixed feelings about. But the setup allows her to build equity and pass the home down to her kids, Wiggins said.

“It was another way of still obtaining the dream,” Wiggins said.

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