Trump wants to crack down on investor-owned homes. Analyst says they've already pulled back in AZ

President Donald Trump announced recently he wants to do something that Democrats here in Arizona have championed before: bar Wall Street investors from buying single-family homes.

For years, these big firms have bought up homes and then often rented them out. And critics say it's driven up prices, a trend we've definitely seen here in the Valley in recent years as prices have gone up. Today, it's harder than ever for first-time homebuyers to break into the market and buy a home.

The Show spoke with real estate analyst Tina Tamboer with The Cromford Report to find out if this proposal could make it easier.

Ayana Hamilton

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KJZZ

Full conversation

LAUREN GILGER: Let's start with the impact of so-called Wall Street investors on the Phoenix housing market here in metro Phoenix. Like at one point, it sounded like they were buying up quite a few homes in the Valley. What's it look like?

TINA TAMBOER: Well, they were for a while. When we were going through what I like to call our crack cocaine season of 2021, it was really crazy when the rates were very low and we were starting to see the prices rise.

We saw a lot of Wall Street-type investors coming in and buying a lot of that. We got as high as maybe 10% of our sales were going to institutions, which is pretty high, but the long-term trend for institutional ownership is extremely low. Like the current rates now are less than 0.1% of anything being purchased by an institution. They did take some heavy losses over the last couple of years.

And so even our rents have been coming down because they bought up the homes and they turned them into rentals. That increases the rental supply, drops rents. So there's all kinds of ways that they can create a rush and then a pretty terrible hangover.

GILGER: So it has been a reason prices have gone up here, but it maybe is not a huge reason right now.

TAMBOER: Yeah, they're not all buying and renting them out. You have institutions like Opendoor and OfferPad that buy them and flip them to another buyer. And so, of course, all we have to go on is a tweet. So we don't really have the details of, you know, what type of institutional ownership is this going to cover, or if it's even going to go any farther than a tweet, a test of the market, a test of us analysts to come out and pull up more charts and graphs and things like that.

But overall, the institutions have had an impact, a short-term impact, but right now they're all pretty dormant. Open Door, OfferPad, the big buyers' invitation homes, they're pretty dormant on the acquisition side.

GILGER: All right. Do you think then a proposal like this could make a dent as we're watching housing prices much higher than they used to be, first time home buyers having a real hard time getting into the market. Would this be a solution in any way?

TAMBOER: Not in our current state. I'd say since most of the institutions have already pulled back, we're not seeing anything that would impact us here short term, but it could potentially lessen a future wave of demand, lessen the impact of institutions if they pass it.

GILGER: So tell us, Tina, like what has caused home prices here to go up so much in the last several years?

TAMBOER: Well ...

GILGER: A lot of things.

TAMBOER: It's kind of a, it's a big bag. But I would say that when we had very, very low mortgage rates and our incomes have been rising here in Greater Phoenix, and so that created a big wave of people who realized that they could then afford a home.

And so what that does is it it kind of attracts everybody into that marketplace and it attracted a lot of cash. And that is what pushed us up in 2021. We peaked in price in June of 2022 and we're down about 14%, 15% from that peak. We've been pretty flat in our pricing.

The good news is for those first-time home buyers, those rates coming down, every 1% drop in the rate is a 10% drop in your mortgage payment, principal and interest. And so we were at 7 1/4 last year. We are now at about 6.1. Always talk to your local lender, by the way. That's where we are nationally.

That is a full, that's more than 10% off. And we're also seeing in that $300,000-$400,000 range, that our prices have come down about 3% or 4% extra from that, and that drops you again. So I'd say with all of the incentives going out, the buyers who maybe felt frustrated over the last couple of years should probably recheck their options.

GILGER: Interesting. OK, so now might be more of a buyer's market. It's been tough on sellers, though?

TAMBOER: Yes. It has been very tough on sellers because with very little appreciation, they may or may not have the equity. The longer this has gone, we are now looking at maybe a good four years of very little appreciation, if any, even some depreciation on homes.

And so that means that the sellers have less to work with in terms of incentives for the buyers, in terms of the ... price reductions and things like that. They're having to look at other options, but they're not desperate. So if they don't want to deal with this market, they just don't put their home on the market. And that definitely helps keep our supply from rising and creating another problem like what we had years ago.

GILGER: The other kind of problem. Let me ask you lastly, then, last minute here or so, Tina, looking toward the new year here at the beginning of 2026, it looks like this might be a relatively balanced market.

What are your projections? What are you looking at?

TAMBOER: We're definitely coming out of a buyer's market. We were in a buyer's market all last year, are moving towards a balanced market. And there is a, I would say, a mild sense of optimism in the real estate industry that we will do better this year than we did last year. And that demand right now is not worse. It's right about the same as where it was at this time last year. But we're watching to see how much supply comes on. That really is the factor.

We're hoping we'll have a good spring season. Last spring, we had, you know, the tariff announcements came out in in the middle of our peak spring season and really put a big dent in that. And we had a kind of a dud of 2025. The bar is very low. I'm just saying, the bar is so low that anything improving onto that will give us some optimism in real estate.