A bill introduced by Democratic Rep. Alex Lee in California aims to limit corporations from buying more than 1,000 single-family home properties for renting out. The bill has passed the State Assembly and is now in the Senate for further consideration. Lee believes that such institutional investors contribute to the state’s housing crisis by driving up prices and outbidding regular Californians. While the bill may not solve the housing crisis, it is seen as a way to mitigate harm caused by corporations profiting from housing shortages.
California has some of the highest housing costs in the country, with the median home-sale price exceeding $900,000 in April. Data from the California Bureau of Research shows that a small number of companies already own more than 1,000 single-family homes each, contributing to less than 1% of home purchases in 2023. The bill aims to target these large corporate investors while exempting individual homeowners with a few rental properties.
The measure has garnered support from the Alliance for Californians for Community Empowerment, but the California Association of Realtors and National Rental Home Council oppose it, citing concerns about clarity and limitations on housing options for renters. The bill is currently undergoing further review in the Senate and may face potential amendments before reaching Governor Gavin Newsom’s desk for approval. If passed, the bill could potentially help address the issue of large corporations profiting from California’s housing market at the expense of regular residents.
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