A Nebraska legislator from north Omaha, where there has been a long-standing housing crisis, is advocating for a bill that, if approved, may establish Nebraska as the first state to prohibit out-of-state hedge funds and other corporate entities from purchasing single-family homes.
Sen. Justin Wayne’s bill aligns with legislative initiatives in other states and at the federal level aimed at limiting the accumulation of single-family homes by corporations. Critics argue that this practice has contributed to the significant increase in housing prices, rent, and real estate taxes in recent years. In Wayne’s area, an Ohio firm has acquired over 150 single-family houses in recent years, frequently displacing individual homebuyers through cash offers. Subsequently, the corporation leases the residences.
Experts attribute the shortage of homes for sale to various issues, such as exorbitant mortgage interest rates and a history of insufficient construction of affordable housing.
Wayne’s bill lacks detailed information. The law states that a corporation, hedge fund, or other business cannot buy single-family housing in Nebraska unless it is located in Nebraska and its main members reside in Nebraska.
A 14-page bill called the End Hedge Fund Control of American Homes Act has been presented in both houses of Congress. It proposes a 10-year timeframe for hedge funds to divest the single-family homes they possess. During this period, the investment trusts would face significant taxes. Consequently, the tax fines would be utilized to assist individuals in making down payments on the divested residences.
Democratic legislators in several other states, such as Minnesota, Indiana, North Carolina, and Texas, have proposed comparable laws, but they have either been delayed or unsuccessful.