Congress is taking aim at the nation’s parasitical hedge funds, which are largely to blame for the housing crisis and bubble market that is preventing many hard-working Americans from owning a home.
Two bills proposed by Democrats this week would require all hedge funds with single-family homes in their portfolios to sell them all off within the next 10 years. The bills would also prohibit hedge funds from owning any single-family homes at all.
In case you have not noticed, housing in America has become just another “stock” that rich people are buying up and hoarding as assets rather than using as a place to live. This has not only driven up housing prices to unsustainable, sky-high levels that working people can no longer afford, but also created a severe housing shortage.
Senate Democrats are proposing the End Hedge Fund Control of American Homes Act of 2023, which would effectively remove hedge funds from the housing equation and make housing more available and affordable to American families that have been priced out of the market by the rich and greedy.
“The housing in our neighborhoods should be homes for people, not profit centers for Wall Street,” said bill co-author Sen. Jeff Merkley (D-Ore.) in a press release.
“Yet, in every corner of the country, giant financial corporations are buying up housing and driving up both rents and home prices. It’s time for Congress to put in place commonsense guardrails that ensure all families have a fair chance to buy or rent a decent home in their community at a price they can afford.”
(Related: Earlier this year, banking giant Credit Suisse lost $5.5 billion on a criminal-run hedge fund that was involved with money laundering and the cocaine trade.)
Let’s get Wall Street out of the housing market completely
Over in the House of Representatives, Democrats are proposing a second bill that would discourage Wall Street from being involved in the housing market at all by charging investors who own more than 75 homes an annual fee of $10,000 per home.
The collected money would then be pooled into a housing trust fund specifically apportioned as monies to help families come up with a down payment.
While the Senate bill contains the words “trust fund” in its title, the House bill is broader, covering any large investor. In essence, the House bill aims to deter the wealthy from stockpiling houses as appreciable assets rather than using them for living as was always intended.
“The language defines ‘hedge fund taxpayer’ as any applicable entity with $50,000,000 or more in net value or assets under management,” explains Business Insider about the proposed legislation.
“Indeed, the truly massive institutional buyer of single family homes in the U.S. has been private equity, with giants like Blackstone and Starwood Capital snapping up large numbers of homes in recent years.”
It should be noted that even smaller mom-and-pop landlords are snapping up housing at a disturbing rate, depriving the next generations of any chance at homeownership no matter how hard they work. They, too, would be reined in by the proposed legislation.
The latest data from CoreLogic shows that investors accounted for 26 percent of all single-family home purchases this past June. This is up from pre-“pandemic” levels of less than 20 percent. A report from the Department of Housing and Urban Development also notes that institutions accounted for just three percent of all home purchases in 2021.
Between 2019 before the “pandemic” and early 2022, median home prices in the United States soared 38 percent to a whopping $431,000. Mortgage rates are also higher than they have been in many decades, having touched eight percent in October.
The latest news about America’s highly corrupt financial system can be found at FinanceRiot.com.
Sources for this article include: