Kevin O'Leary has urged the government to not get involved in housing, saying the new bill that would ban hedge funds from buying homes "is very, very bad and destructive"

Kevin O'Leary has urged the government to not get involved in housing, saying the new bill that would ban hedge funds from buying homes "is very, very bad and destructive," per BI.


During a recent appearance on "The Big Money Show" on Fox Business, Kevin O'Leary expressed his position on the proposed legislation.

O'Leary criticized the idea, stating, "Very bad idea. Very bad policy when you try to manipulate markets or sources of capital. I don't care if they're Democrats or Republicans, whoever they are, stay out of the markets. Let the markets be the markets."

He contends that Wall Street serves as a crucial funding source for the housing market and provides the lowest cost of capital.

The bill's author, U.S. Sen. Jeff Merkley (D-Oregon), argues that institutional investors, including hedge funds, are inflating home prices and rents.

"The housing in our neighborhoods should be homes for people, not profit centers for Wall Street. Yet, in every corner of the country, giant financial corporations are buying up housing and driving up both rents and home prices," said Merkley in a press release. "It's time for Congress to put in place common-sense 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."

Sen. Jeff Merkley (D-Ore.) and Rep. Adam Smith (D-Wash.) introduced a bill aimed at prohibiting hedge funds from acquiring and owning single-family homes. The goal is to provide more families with opportunities for homeownership.

“The purchasing of single-family homes by hedge funds, especially in the current housing market, serves only to make profits for the investors and provides no value to the communities where these homes are located,” stated the members of Congress. “People should not have to go up against hedge funds when they are trying to buy a home in their community. Banning hedge funds from the single-family housing market will help enable more families the opportunity to purchase a home and combat the growing large investor landlord model.”

Over the past decade, large-scale hedge fund investors have significantly increased their presence in the housing market. In 2011, no single hedge fund owned over 1,000 single-family rental units. As of June 2022, an Urban Institute study estimated that large hedge funds and institutional investors owned approximately 574,000 single-family homes. According to Merkley and Smith, this trend is ongoing, with these entities acquiring 27 percent of single-family homes in the first three months of this year.

“Predatory hedge funds disproportionately target Black families and vulnerable single parents, as revealed in a recent House Financial Services Committee report,” Merkley and Smith noted. “The report found these investors focus on neighborhoods with larger Black populations and approximately 30 percent more single mothers than the national average. Additionally, studies show that hedge funds are 68 percent more likely than small landlords to file for evictions and often impose high rent increases, inflated fees, and deteriorating housing conditions to maximize profits.”

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