Congress targets hedge funds buying up single-family homes with 15% tax
S. 3930 — HOPE (Humans over Private Equity) for Homeownership Act · Filed by Jeff Merkley (D-OR) · 1 cosponsor · Introduced Feb 26, 2026 · Referred to committee
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What it does
This bill imposes a 15% excise tax on hedge funds and large private equity firms (with $50M+ in assets) when they buy single-family homes, and denies them tax deductions for mortgage interest, depreciation, and business income on rental properties. The goal is to discourage institutional investors from buying up residential housing stock that ordinary families might otherwise purchase.
Why we flagged it
The bill uses tax policy to discourage large investment firms from acquiring single-family residences for rental or speculation, treating housing as a public-interest asset rather than a pure investment commodity. It is fundamentally a market-structure intervention, not a revenue measure.
What the text implies
- The 15% excise tax applies only at acquisition; existing hedge fund portfolios of single-family homes are grandfathered, meaning the policy does not unwind current institutional ownership but only slows future accumulation.
- The mortgage-interest and depreciation deductions are disallowed only for hedge funds actively in the rental business (post-2030), creating a potential loophole for funds that hold properties for appreciation without active rental operations.
The full analysis lists 4 implications of this text.
Who stands to gain
individual homebuyers and owner-occupants; small residential builders and developers; local real estate markets with reduced institutional competition