Big investors have been fleeing for-sale housing market, even before Trump ordered ban

In an aerial view, two-story single family homes line the streets on Jan. 14, 2026 in Thousand Oaks, California.Kevin Carter | Getty ImagesLegislation to ban institutional investors from buying single-family homes to rent is making its way through Congress, but many of them are already selling thousands of homes — and have been for two years. Research from housing data and analytics firm Parcl Labs shows that the largest investors are now net sellers of homes. In every major metropolitan housing market, investors make up a larger share of for-sale listings than they do of the total housing stock. In some cities, like Dallas, Philadelphia and Houston, they are selling most aggressively. Dallas investors own 9.2% of the housing stock but account for 22.8% of new for-sale listings.FirstKey Homes appears to be most motivated, with more than twice the listings of its peers, according to Parcl. It is also offering much deeper price cuts, an average 10% off original list prices, and is reducing prices about every 20 days."It's a volatile housing market, and folks are trying to take risk off the table," said Jason Lewris, co-founder of Parcl Labs. He noted that rents are not holding up relative to what investors can get if they sell. "So it's better risk-adjusted returns to just get that cash and see how things pan out," he said.In its latest quarterly earnings release for the fourth quarter of 2025, Invitation Homes, one of the largest publicly traded landlords, reported that all 368 of its wholly owned acquisitions were newly constructed homes purchased from various homebuilders. It reported selling 315 existing homes. For the full-year 2025, Invitation reported "almost all" of its 2,410 wholly owned acquisitions were bought through homebuilder relationships, while it sold 1,356 wholly owned homes, "frequently to families purchasing for their own use."In an effort to make housing affordable, in late January, President Donald Trump signed an executive order aimed at restricting large, institutional investors from buying single-family homes to use as rentals. He put an exemption on purchasing new construction specifically built as rentals. The White House later sent proposed legislation to Congress, saying investors owning more than 100 single-family homes would be banned from buying any more, but didn't have to sell what they have. Senate and House bills have different volume thresholds for what constitutes large investors, but they are not far apart. To put this in perspective, single-family rentals make up roughly 10% of U.S. housing stock, and the vast majority, 80%, are owned by so-called "mom-and-pop operators," with fewer than 10 homes each, according to analysis from Bank of America. Smaller investors, those who own between 10 and 1,000 homes, make up 17% of landlords. Large institutional investors who own more than 1,000 homes make up just 3% of the single-family rental market.The numbers, however, are coming down. Investors initially flooded the market after the subprime mortgage crash that led to the Great Recession. Home prices in some markets dropped by half, and foreclosures soared. Investors bought the homes at bargain prices and turned them into lucrative rentals. As the markets recovered, there were fewer entry-level homes for sale to owner-occupants, because investors focused on that segment. In some cities, like Atlanta, regular buyers couldn't compete with investors, who usually came carrying cash. Some neighborhoods are nearly fully investor-owned.But by 2022, even before Trump took office for the second time, investors were already in retreat, buying fewer homes, according to Parcl. Selling accelerated in late 2024, with investors in Atlanta now selling nearly two properties for every one they buy. Investors are now pivoting to build-for-rent. Much of the net selling shift over the past few years was a natural process of recycling capital, according to Rick Palacios, director of research at John Burns Research and Consulting. "Home prices ran up post-2020, and many single-family rental investors sold assets into a rising home price backdrop, then redeployed capital into higher-yielding build-to-rent versus buying on resale at those very high prices and elevated borrowing costs for investors too," Palacios said. Builders also adjust their prices in real time, he noted, while resale sellers don't. "This offered opportunities for investors to purchase at discounts from builders," he added. Invitation Homes has been buying homes from builders like Lennar but, in January, announced it had acquired Atlanta-based ResiBuilt Homes, a build-to-rent developer in high-growth markets across the Southeast. ResiBuilt was delivering about 1,000 homes per year, but Invitation Homes expects to expand that. "One of the most constructive ways we can help is by adding more homes to the markets we serve," said Dallas Tanner, CEO of Invitation Homes, on an earnings call last month with analysts. "While our home-builder partnerships have supported that effort for years, our acquisition of ResiBuilt expands it even further and improves our control over cost, product quality and delivery pace."AMH, formerly known as American Homes 4 Rent, meanwhile, has been building entire rental communities itself for several years. In its latest fourth-quarter earnings release, CEO Bryan Smith said, "Since the inception of our ground up development program, we have contributed over 14,000 newly built homes to the nation's housing stock. Our results in 2025 and outlook for 2026 reflect continued focus on expanding the nation's housing supply, elevating the resident experience, and creating value for all our stakeholders."