Oregon Sen. Jeff Merkley is looking to stop investors from
collecting massive portfolios of single-family homes, citing the national
housing affordability crisis.
Merkley, who used to head up Portland’s Habitat for
Humanity, introduced a bill in the U.S. Senate to discourage taxpayers from
owning more than 100 single-family homes by imposing a $20,000 federal tax on
each residence over the cap. Merkley took aim at “hedge funds and private
equity firms” with the proposed legislation.
“They’re pouring fuel on the fire of the affordable
housing crisis that so many of our communities are facing, leaving working
families behind,” the Democratic senator said in a statement. “The
housing in our neighborhoods should be homes for people, not profit centers for
Wall Street.”
The bill would exempt some taxpayers, such as nonprofits and
those who own federally subsidized housing. Importantly, it defines a
single-family home as “a residential property consisting of 1-to-4
dwelling units,” so that could include properties traditionally thought of
as duplexes, triplexes and quadplexes.
Revenues from the taxes would go toward down-payment
assistance programs via a housing trust fund that would be created. State
housing finance agencies that get the money would have to prioritize families
looking to buy homes sold by the entities or individuals selling them for the
purposes of the bill.
Under the proposal, failure to report the required
information without “reasonable cause” would be met with a $20,000
penalty.
“To allow for an orderly exit from the housing
investment market, this legislation allows hedge funds and other investors to
sell the homes they own over several years,” Merkley’s office said.
“Hedge funds and investors must sell at least 10% of the total number of
single family homes to families (not companies or any other businesses) per
year. And they are banned from selling any single-family home to other
corporations.”
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