Senator Baldwin Leads Bill to Expand Affordable Housing, Crack Down on Wealthy Investors Who Buy Local Homes

WASHINGTON, D.C. — As the nation’s housing shortage pushes home prices and rents to historic levels, U.S. Senator Tammy Baldwin (D-WI) introduced a bill that would crack down on wealthy investors who purchase many homes and provide tens of billions of dollars to help create millions of new homes for low-income Americans. The Affordable Housing and Homeownership Protection Act would provide up to $50 billion over ten years to help build and preserve approximately 3 million affordable housing units nationwide. The bill would be fully paid for by taxing investors who purchase and hold more than 15 single-family homes.

“Wealthy, out-of-state investors are buying up housing stock in Wisconsin – driving up rent and putting home ownership out of reach for too many in the state. It’s wrong and we need to both crack down on these Wall Street investors and also do more to preserve and expand access to affordable housing for the Wisconsinites who live, work, and raise families in our communities,” said Senator Baldwin. “Our bill will get at both ends of this problem – disincentivizing any wealthy investor from gobbling up Wisconsin’s housing and, if someone does, then making sure they are part of the solution to create more opportunities for safe, affordable housing.”

As housing costs skyrocket and wealthy investors buy up single-family homes in cities, more Wisconsinites are priced out of homeownership, while increased rent means less to save or spend on food, clothing, and other everyday necessities. Driven by a shortage of as many as 6.8 million homes nationwide, home prices have surged 39% and rents 31% over the last four years, according to the National Association of Realtors and Zillow.

At the same time, investors are buying a greater share of single-family homes sold each year – many of which they hold as rentals – preventing more families from reaching homeownership and often driving up rents. Most households cannot compete with the largest investors, usually private equity and other institutional investors, who can use their financial might to make all-cash offers, waive contingencies, and provide other concessions individuals are unable to match.

The Affordable Housing and Homeownership Protection Act would help level the playing field for families by imposing a transfer tax on large investors who profit by purchasing sixteen single-family homes or more. Nonprofits, states, and localities would be excluded from the tax. The funds from these taxes would be split 65/35 between the Housing Trust Fund and Capital Magnet Fund and could build or rehabilitate over 300,000 housing units for extremely low-income Americans and help finance 2.7 million units of housing for low-income households.

The bill, led by Senators Baldwin, Jack Reed (D-RI), and Tina Smith (D-MN), is also co-sponsored by Senators Kirsten Gillibrand (D-NY), Richard Blumenthal (D-CT), Amy Klobuchar (D-MN), and John Fetterman (D-PA).

The Affordable Housing and Homeownership Protection Act has been endorsed by several leading organizations, including: the National Low Income Housing Coalition; National Housing Law Project; National Consumer Law Center (on behalf of its low-income clients); Consumer Action; Americans for Financial Reform; and National Housing Resource Center.

“As rents rise and home prices continue to soar, our growing homelessness and housing affordability crisis requires us to use every tool in the toolbox to support housing affordability for people before profits for large investors and private equity firms. The Affordable Housing and Homeownership Protection Act will ensure that big housing investors pay their fair share to meet our massive affordable housing deficit,” said Caroline Nagy, Senior Policy Counsel at Americans for Financial Reform Education Fund.

“The Affordable Housing and Homeownership Protection Act is the kind of legislation that can make a meaningful difference in people’s lives,” said Ruth Susswein, Consumer Action’s Director of Consumer Protection. “It requires private investors—who drain the housing market of affordable homes—to bear responsibility for providing some of the funds needed to make housing a reality for some of our neediest neighbors.”

“America needs the Affordable Housing and Homeownership Protection Act.  Housing counselors across the country are reporting that first time homebuyers cannot find affordable houses to buy and renters are devoting so much of their incomes to making the monthly rent that they sacrifice other basics.  We need to provide safe and affordable housing for America’s families to thrive and this Act is a bold, practical solution to address the affordable housing shortage,” said Bruce Dorpalen, Executive Director of the National Housing Resource Center.

An online version of this release is available here.

NOTE: This press release was submitted to Urban Milwaukee and was not written by an Urban Milwaukee writer. While it is believed to be reliable, Urban Milwaukee does not guarantee its accuracy or completeness.