Trump strikes hard: Banning Wall Street from purchasing single-family homes, what does it mean for the market?

On January 7, 2026, former U.S. President Trump posted on Truth Social, announcing that he would “immediately take action to prohibit large institutional investors from purchasing more single-family homes,” and that he would elaborate on this housing policy at the Davos Forum two weeks later. He accused former President Biden and Congressional Democrats of causing “historic high inflation,” making the American Dream “increasingly out of reach for too many people, especially young Americans.”

Policy Impact

This policy directly targets the role of Wall Street institutional investors in the housing market. Trump explicitly stated on social media: “Housing is for people to live in, not for corporations to hoard.”

Since the 2008 financial crisis, the U.S. real estate market has undergone a structural shift from individual buyers to dominance by institutional investors. Private equity firms like Blackstone, real estate investment trusts, and other large institutional investors have built extensive portfolios of single-family rental homes over the past decade. These entities have faced increasing criticism for allegedly distorting the housing market and driving up prices. The direct target of Trump’s policy this time is precisely these institutional investors.

Market Turmoil

Following the announcement, financial markets reacted swiftly. Blackstone Group’s stock fell 4.60% on the New York Stock Exchange, with an intraday drop of up to 9.30%. Shares of other major private equity firms also suffered heavy losses. Apollo Global Management declined 4.57%, KKR & Co. fell 2.24%, and BlackRock dropped 2.64%. The largest single-family rental operator in the U.S., Invitation Homes Inc., saw its stock plunge as much as 10% intraday, ultimately closing down 8.19%.

U.S. homebuilders were also not spared. The PHLX Housing Index fell 2.1% on the day, marking its largest single-day percentage decline since November 17, 2025.

Chain Reaction in the Cryptocurrency Market

When the traditional real estate market experiences turbulence, capital often seeks alternative asset classes, and cryptocurrencies could be potential beneficiaries of this capital flow. As of January 9, 2026, Bitcoin’s price increased by 3.2% over the past 24 hours, and Ethereum rose 2.8%. This divergence from traditional asset trends indicates that some investors may be reassessing their asset allocations.

As uncertainty in the real estate market increases, some capital may flow into the cryptocurrency market, especially assets regarded as “stores of value.” For platforms like Gate, this market shift presents new opportunities. Trading volume of major cryptocurrencies on Gate increased by approximately 15% over the past 24 hours, indicating rising market activity.

Deep Policy Logic

Trump’s housing policy is not an isolated move. In his post, he explicitly stated that he would call on Congress to codify it into law, and he plans to further discuss the U.S. housing plan and affordability issues at the World Economic Forum in Davos from January 19 to 23. This move has clear political considerations. Recent months have shown declining public support for Trump’s handling of the economy in polls, with more Americans expressing concerns about affordability.

Facing midterm elections that could determine whether Trump’s Republican Party maintains control of Congress, the Republican president faces increasing pressure to address voters’ anxieties over living costs.

Turning Point in the Real Estate Market

If implemented, this policy would deprive private equity firms of one of their main investment tools. Since the pandemic, as vacancy rates in U.S. commercial real estate soared, these companies have been accumulating losses. It remains unclear how this ban targeting private equity firms and other large institutional investors will be structured or enforced.

Trump stated he is “calling on Congress to codify it into law.” He did not specify details about the policy, its form, or the modifications he seeks from Congress. Trump said he would announce further details in his speech at the Davos Forum in two weeks.

Analysts suggest that if this policy is enacted, it could have far-reaching impacts on the U.S. real estate market. Over the past decade, private equity funds, real estate investment trusts, and other large institutional investors have built extensive portfolios of single-family rental homes. Major private equity firms are increasingly focusing on residential and commercial real estate as M&A and IPO opportunities diminish.

New Perspectives on Asset Allocation

Since the 2008 financial crisis, Wall Street financial institutions have purchased thousands of single-family homes. This trend has drawn criticism from housing advocacy groups and legislators, including Democrats, who claim that institutional landlords fuel rent inflation. From a broader asset allocation perspective, changes in the real estate market could influence investors’ overall risk appetite and diversification strategies. When traditional asset classes face policy uncertainty, investors often seek other assets with lower correlation.

Cryptocurrencies, especially those with scarcity features, may garner more attention in such environments. As of January 9, 2026, data from Gate shows that seven of the top ten cryptocurrencies by market cap achieved positive returns over the past week, displaying price trends different from real estate and stock markets.

Following the policy announcement, Blackstone’s market value temporarily evaporated by over $7 billion, despite managing assets exceeding $1.1 trillion. This contrast highlights how policy signals can amplify market sentiment. When the Davos Forum opens on the 19th of this month, Trump’s speech may no longer be just about housing policy but could become a pivotal moment for global capital to reassess risks and opportunities in the U.S. market.