President Trump signs executive order to lower mortgage rates and bring less competition
Speakers
Diana Olick
— CNBC Real Estate Correspondent
Summary
CNBC's Diana Olick reports on President Trump's executive order targeting large-scale single-family rental investors while exempting the build-to-rent market. She notes the exemption is a relief for builders like Lennar and Taylor Morrison, while Invitation Homes and American Homes for Rent face a more complex setup. Pending home sales fell 9% in December and affordability remains a concern, dampening the housing outlook.
- Trump signed an executive order to ban large-scale investors from buying more single-family homes.
- Build-to-rent investors are exempt, which Olick says is a relief for Lennar and Taylor Morrison.
- Invitation Homes, American Homes for Rent, Blackstone, and Pretium are named as targeted large-scale investors.
- Analysts say the ban could help markets like Nashville and Atlanta.
- Nationally, institutional investors own only about 1% of rental stock.
- Pending home sales fell 9% month-over-month in December.
- Mortgage rates were around 6.25% in December and higher than last summer.
- Trump says he wants lower mortgage rates and less competition without hurting home values.
Ideas
Invitation Homes faces SFR purchase ban
The executive order is designed to ban large-scale single-family rental investors like Invitation Homes from purchasing more single-family homes, creating a regulatory overhang for its acquisition-driven growth, though the national impact may be limited because big institutionals own only about 1% of the rental stock.
Build-to-rent exemption relieves homebuilders
President Trump's executive order bans large-scale investors from purchasing more single-family homes, but it exempts investors in the build-to-rent market. Diana Olick says this is a big relief for builders like Lennar and Taylor Morrison, who sell to investors.
American Homes for Rent setup uncertain
American Homes for Rent is named among the large-scale investors targeted by the executive order, but it is also a major build-to-rent player and top-40 homebuilder, so the build-to-rent exemption may mitigate the ban's impact and the net effect is worth monitoring.
