Palm Springs, CA
Some influential figures within California’s legislative body are advocating for the removal of major real estate investors from the state’s single-family neighborhoods. This push comes in response to concerns about the excessive acquisition of these highly sought-after properties by large investment entities.
In the upcoming legislative session, there are three proposed bills aimed at addressing this issue. These bills aim to curb the dominance of institutional investors in the single-family housing market, a phenomenon that gained momentum in the aftermath of the Great Recession. While traditional apartment buildings have long been targets for big investment firms, the focus has shifted to single-family homes in recent years.
One of the bills, Assembly Bill 2584, spearheaded by Assemblymember Alex Lee, seeks to prohibit institutional investors from purchasing additional single-family properties for rental purposes. Senate Bill 1212, introduced by Senate Housing Committee Chair Nancy Skinner, takes a more comprehensive approach by prohibiting institutional investors from acquiring single-family homes or duplexes altogether, irrespective of their intended use. Another bill, Assembly Bill 1333, proposed by Ward, targets the practice of developers selling homes en masse to large investors. This bill aims to curb the popularity of “build-to-rent” projects, where developers construct single-family subdivisions with the explicit intention of selling them to rental companies. Notably, this particular bill has garnered support from the state’s REALTOR association, as it seeks to prevent bulk sales that could sideline real estate agents from the transaction process.