Khanna Bill: Investors Banned from Buying Homes
- Representative Ro Khanna (D-CA) reintroduced legislation on January 16, 2026, aiming to restrict large institutional investors from purchasing single-family homes, seeking to increase homeownership opportunities for families and...
- The "Homes for People, Not Profits act" directly targets institutional investors - defined as entities owning more than 50 single-family homes - and seeks to limit their ability...
- This is not the first time Representative Khanna has pursued this legislation.
Khanna Proposes Bill to Limit Institutional Investment in Residential real Estate
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Representative Ro Khanna (D-CA) reintroduced legislation on January 16, 2026, aiming to restrict large institutional investors from purchasing single-family homes, seeking to increase homeownership opportunities for families and reduce housing costs.Teh bill, known as the ”Homes for people, Not Profits Act,” builds on a previous attempt and faces scrutiny from the tech industry due to Khanna’s Silicon Valley ties.
Bill Details and Objectives
The “Homes for People, Not Profits act” directly targets institutional investors – defined as entities owning more than 50 single-family homes – and seeks to limit their ability to further expand their portfolios. The primary goal is to shift the balance in the housing market away from investment firms and towards individual homebuyers. Khanna argues that the increasing presence of institutional investors drives up home prices, making it harder for families to achieve homeownership.
Specifically, the bill proposes to:
- Prohibit institutional investors from selling properties within five years of purchase, discouraging fast flips.
- Require institutional investors to pay a tax equal to 50% on any profits made from the sale of single-family homes.
- Establish a fund to support frist-time homebuyers and community development financial institutions.
the bill text is available for review on Congress.gov.
Background and Previous Attempts
This is not the first time Representative Khanna has pursued this legislation. A similar bill was introduced in the 118th Congress but did not pass.The renewed effort comes amid ongoing concerns about the growing influence of institutional investors in the housing market, particularly in the wake of the COVID-19 pandemic. Data from the National Association of Realtors shows a meaningful increase in institutional purchases of single-family homes in recent years.
According to a report by the National Association of Realtors,institutional investors accounted for 17.4% of all single-family home sales in the first quarter of 2024. This represents a substantial increase from previous years and highlights the growing role of these entities in the housing market.
Industry Response and Concerns
The bill has drawn criticism from some corners of the tech industry, particularly given Khanna’s close ties to Silicon Valley. critics argue that the legislation could stifle investment in the housing market and possibly harm renters. Some also suggest that the bill unfairly targets institutional investors while failing to address other factors contributing to housing affordability challenges, such as zoning regulations and supply shortages.
CNBC reported on the tech industry backlash on December 29, 2025, detailing concerns about the potential impact on investment strategies. The debate underscores the complex interplay between technology, investment, and housing policy.