Proposed Legislation Restricting Corporate Ownership of Single-Family Homes: What Florida Property Owners and Investors Need to Know

Over the past few years, the U.S. housing market has seen a sharp rise in institutional investors and corporate entities purchasing single-family homes. In some markets, these purchases have priced out individual buyers, driven up rents, and created long-term affordability concerns.

Now, legislators across the country, including in Florida, are responding with proposed bills that aim to limit corporate ownership of single-family homes. If you’re an investor, landlord, private equity fund, or small business entity involved in residential real estate, these proposals could significantly affect how you operate.

At Ayala Law, we represent businesses and individuals navigating real estate regulation in Florida. In this blog post, we break down what’s being proposed, why it matters, and what steps to take if you own or plan to acquire residential homes through a business entity.

What Is the Proposed Ban on Corporate Ownership of Homes?

Legislators in multiple states, and even at the federal level, have introduced bills aimed at curbing corporate ownership of residential properties, particularly single-family homes.

While the language varies by jurisdiction, the proposals typically seek to:

• Cap the number of single-family homes a corporate entity can own
• Ban certain institutional investors from acquiring additional homes
• Require corporate landlords to sell a portion of their residential portfolios
• Limit property purchases by LLCs, REITs, hedge funds, and private equity firms

In Florida, the discussion has intensified as home prices and rents continue to outpace income growth, particularly in metropolitan areas like Miami, Tampa, and Orlando.

Why Is This Legislation Being Proposed?

The proposed legislation is largely driven by concerns about housing affordability and community stability.

Key concerns driving the proposals:

• Large corporate landlords outbidding families in competitive markets
• Higher eviction rates and reduced tenant protections from institutional landlords
• Decreased homeownership rates among first-time buyers
• Concentration of housing stock in fewer hands, which can impact pricing and availability

The goal, according to proponents, is to rebalance the market, making it easier for individuals and families to buy homes, while discouraging speculative investment in residential neighborhoods.

How Would This Affect LLCs and Business Owners in Florida?

If your business holds residential rental properties under an LLC, partnership, or other corporate structure, here’s what you need to consider:

1. Restrictions on Future Purchases

Proposed legislation may cap the number of single-family properties a company can buy within a geographic area or state. This could limit portfolio expansion for investment groups or LLC landlords.

2. Ownership Disclosure Requirements

Some bills call for greater transparency in property ownership, requiring disclosure of beneficial owners behind LLCs or shell companies. This affects how you structure acquisitions and manage privacy.

3. Forced Divestment or Sale

In more aggressive proposals, entities that exceed ownership caps could be forced to sell off part of their holdings over a specified time period. This could lead to capital gains exposure and strategic divestment planning.

4. Heightened Scrutiny on Rental Practices

With increased regulation, corporate landlords may also face new compliance requirements, tenant protections, and reporting obligations.

Are These Proposals Likely to Become Law?

Some of the proposals are symbolic or exploratory, especially at the federal level. But others are gaining traction, especially in areas where local governments are under pressure to address housing costs.

In Florida, real estate is a major driver of the state economy, and lawmakers tend to favor business-friendly regulation. However, that doesn’t mean such proposals are off the table. Local municipalities or counties could push for zoning changes, permitting hurdles, or investor caps even without statewide legislation.

Bottom line: If you’re an investor or property owner using corporate entities, this is worth watching closely.

What Can Real Estate Investors Do to Prepare?

If you’re currently holding or planning to acquire single-family homes through a business structure, now is the time to:

• Review your ownership structure with legal counsel
  (e.g., LLCs, Series LLCs, Trusts, or joint ventures)
• Evaluate exposure across multiple jurisdictions, especially if you own in different counties or states
• Track proposed legislation at the state and federal level
• Reassess acquisition strategies in light of potential restrictions
• Consult with a real estate attorney to stay compliant and proactive

At Ayala Law, we help clients structure real estate ownership in a way that is both legally sound and adaptable to changing regulations.

Should Individuals Be Concerned About Using LLCs to Hold Property?

Many small landlords and families use LLCs for asset protection and estate planning purposes. These types of structures are very different from institutional investment strategies, but could still be caught in overbroad legislation if it’s not carefully written.

That’s why custom legal structuring matters. A one-size-fits-all approach is risky in today’s evolving real estate climate.

Be Strategic, Not Reactive

Whether or not these bills pass concerning single-family homes, they reflect a shift in how legislators view corporate participation in the housing market. If you’re building a real estate portfolio or managing properties through business entities, now is the time to review your legal structure, ownership strategy, and long-term goals.

If you’d like to review your holdings or acquisition plans, contact an experienced attorney in Miami at 305-570-2208.

You can also contact attorney Eduardo A. Maura at eduardo@ayalalawpa.com.

Schedule a case evaluation online here.