S. 3673Senate118th Congress (2023-2025)In Committee

Affordable Housing and Homeownership Protection Act of 2024

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Updated January 20, 2026 at 2:15 PM UTC

The Affordable Housing and Homeownership Protection Act of 2024 adds a new tax on the purchase of single‑family homes by larger investors. It targets investors who own many homes—medium (15‑25), large (26‑100), and giant (over 100)—and directs the revenue to federal affordable‑housing programs. The tax does not apply to new construction by the investor or to certain nonprofit, governmental, and community‑based entities. The law also raises the minimum funding amount for small states under the Housing Trust Fund.

Key Provisions

Imposes a tax on covered investors when they buy a single‑family home: 1% of the purchase price for medium‑sized investors, 3% for large investors, and 5% for giant investors.
Defines covered investors by the number of single‑family homes they own (15‑25, 26‑100, over 100) and excludes new construction unless it replaces a previously owned home.
Exempts nonprofit affordable‑housing organizations, states and political subdivisions, public housing authorities, land banks, and community land trusts from the tax.
Requires covered investors to report the number of homes owned and purchased each year to the Treasury.
Allocates 65% of the tax revenue to HUD’s Housing Trust Fund and 35% to the Capital Magnet Fund.
Increases the small‑state minimum funding threshold in the Housing Trust Fund from $3 million to $7 million.

Legislative Activity

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2 earlier actions

SenateCommittee Latest Action

Committee on Banking, Housing, and Urban Affairs. Hearings held.

Banking, Housing, and Urban Affairs Committee

March 12, 2024

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SenateIntro Referral

Introduced in Senate

January 25, 2024

SenateIntro Referral

Read twice and referred to the Committee on Finance. (Sponsor introductory remarks on measure: CR S270)

Finance Committee

January 25, 2024

SenateCommittee

Committee on Banking, Housing, and Urban Affairs. Hearings held.

Banking, Housing, and Urban Affairs Committee

March 12, 2024

Floor Debate

1 member

What members said about S. 3673 on the floor

1 Democrat

Sen. Jack ReedD-RI · Jan 25, 2024

Madam President, today, I am introducing the Affordable Housing and Homeownership Protection Act with Senators Smith, Gillibrand, Blumenthal, Klobuchar, Fetterman, and Baldwin. Our bill would provide up to $50 billion to help build and preserve approximately 3 million units of affordable housing and would be fully paid for through a transfer tax on investors who acquire and hold more than 15 single-family homes.

Driven by a shortage of as many as 6.8 million homes nationwide, home prices have surged 39 percent and rents 31 percent over the last 4 years, according the National Association of Realtors and Zillow. Higher rents and fewer opportunities for home ownership are devastating for millions of families. As housing costs skyrocket, more households are priced out of home ownership, while renters have less to spend on food, clothing, and other everyday necessities.

Low-income Americans are particularly strained. The National Low Income Housing Coalition estimates that 73 percent of extremely low- income households spend more than half their income on housing. Unsurprisingly, homelessness has risen in line with housing prices and is up 15 percent since 2019.

Unfortunately, Federal investments in low-income housing are insufficient to solve this affordability crisis. Indeed, researchers at Harvard University found that the three largest Federal housing programs serve nearly 300,000 fewer households today than they did 20 years ago, while approximately 25 percent more households are eligible but can't get aid.

At the same time, investors are buying a greater share of single- family homes sold each year--many of which they hold as rentals-- preventing more families from reaching home ownership and often driving up rents. Most households cannot compete with the largest investors, who are typically private equity and other institutional investors. That is because large investors can use their financial might to make all-cash offers, waive, contingencies, and provide other concessions that individual buyers simply cannot match. Through last October, more than one out of every four single-family homes sold in 2023 were bought by investors, not hard-working households--a 69-percent increase from investors' prepandemic share of home purchases.

Our Affordable Housing and Homeownership Protection Act would tackle both our affordable housing crisis and institutional investors who crowd out families in the housing market. It would raise $50 billion by taxing investors who purchase large numbers of single-family homes, with higher tax rates for the largest investors. Revenue would be split between the Housing Trust Fund, HTF, and Capital Magnet Fund, CMF, to help build and rehab over 300,000 rental units for extremely low-income Americans through HTF grants and help finance 2.7 million homes for low-income families via CMF, which leverages private investments.

In other words, our bill would help build and rehabilitate millions of homes for American families and boost households competing to buy homes with deep-pocketed investors, all without raising the deficit. This is a commonsense, fair proposal that tackles perhaps our Nation's biggest challenge.

I thank the bill's endorsers--the National Low Income Housing Coalition, National Housing Law Project, National Consumer Law Center on behalf of its low-income clients, National Housing Resource Center, Americans for Financial Reform, and Consumer Action--and urge my colleagues to support this important legislation.

Sen. Jack ReedD-RI · Jan 25, 2024

Bill Text

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Introduced in SenateIssued January 25, 2024

118th CONGRESS

2d Session

S. 3673

IN THE SENATE OF THE UNITED STATES

January 25, 2024

Mr. Reed (for himself, Ms. Smith, Mrs. Gillibrand, Mr. Blumenthal, Ms. Klobuchar, Mr. Fetterman, and Ms. Baldwin) introduced the following bill; which was read twice and referred to the Committee on Finance

A BILL

To amend the Internal Revenue Code of 1986 to impose a tax on the purchase of single-family homes by certain large investors, and for other purposes.

Short title

This Act may be cited as the Affordable Housing and Homeownership Protection Act of 2024.

Tax on certain investor purchases of single-family homes

(a)

In general

Chapter 36 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subchapter:

Certain home purchases

4499.

Tax on certain investor purchases of single-family homes

(a)

In general

There is hereby imposed on each covered investor a tax equal to the applicable percentage of the purchase price paid by such covered investor with respect to any covered home purchase during the taxable year.

(b)

Applicable percentage

For purposes of subsection (a), the applicable percentage is—

(1)

1 percent in the case of a medium-sized investor,

(2)

3 percent in the case of a large investor, and

(3)

5 percent in the case of a giant investor.

(c)

Covered investor

For purposes of this section—

(1)

In general

The term covered investor means any person, other than a person described in paragraph (6), who is a medium-sized investor, large investor, or giant investor.

(2)

Medium-sized investor

The term medium-sized investor means any person who owns more than 15 and not more than 25 single-family homes as of the last day of the taxable year.

(3)

Large investor

The term large investor means any person who owns more than 25 and not more than 100 single-family homes as of the last day of the taxable year.

(4)

Giant investor

The term giant investor means any person who owns more than 100 single-family homes as of the last day of the taxable year.

(5)

New construction excluded

Any new single-family home which is constructed by the taxpayer shall not be taken into account for purposes of this subsection, unless such single-family home replaces a previous single-family home on the same site which was purchased by the taxpayer and replaced with the newly constructed single-family home.

(6)

Exceptions

A person described in this paragraph is—

(A)

any organization which is exempt from taxation under section 501(a), the primary purpose of which is related to affordable housing, housing counseling, or neighborhood stabilization,

(B)

any State or political subdivision thereof,

(C)

any public housing authority or its instrumentalities,

(D)

any land bank, or

(E)

any community land trust.

(d)

Terms relating to home purchase, etc

For purposes of this section—

(1)

Covered home purchase

(A)

In general

The term covered home purchase means the purchase of a single-family home by a covered investor.

(B)

New construction

The construction of a new single-family home by the taxpayer shall not be treated as a purchase, unless such new single-family home is taken into account for purposes of subsection (c) by reason of paragraph (5) thereof.

(2)

Purchase price

The term purchase price means the total amount paid, including the amount of any indebtedness incurred or assumed, by the taxpayer to acquire a single-family home from the seller.

(3)

Single-family home

The term single-family home has the meaning given such term by section 81.2 of title 24, Code of Federal Regulations.

(4)

Own

The term own means directly or indirectly possessing a majority interest in a single-family home.

(e)

Aggregation rules

(1)

In general

Except as otherwise provided in paragraph (2), all persons treated as a single employer under subsection (a) or (b) of section 52, or subsection (m) or (o) of section 414, shall be treated as 1 person for purposes of this section.

(2)

Modifications

For purposes of this subsection—

(A)

section 52(a) shall be applied by substituting component members for members, and

(B)

for purposes of applying section 52(b), the term trade or business shall include any activity treated as a trade or business under paragraph (5) or (6) of section 469(c) (determined without regard to the phrase To the extent provided in regulations in such paragraph (6)).

(3)

Component member

For purposes of paragraph (2), the term component member has the meaning given such term by section 1563(b), determined without regard to paragraph (2) thereof.

(f)

Reporting

Each person who is a covered investor for the taxable year shall attach to the return of the tax imposed by this section a report containing information, in such form as the Secretary shall prescribe, on—

(1)

the number of single-family homes owned on the last day of the taxable year by such person, and

(2)

the number of single-family homes purchased by such person during the taxable year.

(b)

Clerical amendment

The table of subchapters for chapter 36 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:

SUBCHAPTER G—Certain home purchases

(c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2023.

Revenues

The Secretary of the Treasury shall allocate or otherwise transfer such revenues resulting from the tax imposed by section 4499 of the Internal Revenue Code of 1986 as follows:

(1)

65 percent of such amounts to the Secretary of Housing and Urban Development to provide additional funding for the Housing Trust Fund established under section 1338(a) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4568(a)).

(2)

35 percent of such amounts to provide additional funding for the Capital Magnet Fund established under section 1339(a) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4569(a)).

Housing Trust Fund small State minimum

Section 1338(c)(4)(C) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4568(c)(4)(C)) is amended by striking $3,000,000 each place that term appears and inserting $7,000,000.