In an effort to address housing affordability, President Trump floated the idea of allowing ordinary homeowners to take an annual depreciation deduction on their personal residences to recover certain property costs over a set period of time, noting that when a “corporation buys a house, they get depreciation.” Trump’s remarks followed his signing of an executive order barring “institutional investors” from owning “single family homes.”
Under the order, the Treasury Department has 30 days to develop “definitions of ‘large institutional investor’ and ‘single-family home.’” Within 60 days, the Agriculture Department, the Department of Housing and Urban Development, the Department of Veterans Affairs, the General Services Administration, and Federal Housing Finance Agency are required to issue guidance ensuring that they are not “providing for, approving, insuring, guaranteeing, securitizing, or facilitating the acquisition” of single family homes by large institutional investors. This guidance must include “exceptions for build-to-rent properties that are planned, permitted, financed, and constructed as rental communities, and such other appropriate, narrowly tailored exceptions as the applicable agency may determine appropriate to further the policies of [the] Administration.” The Justice Department and the Federal Trade Commission are directed to review acquisitions by large institutional investors for anti-competitive practices and prioritize enforcement against such practices by institutional investors in the single-family home rental market.