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21st Century ROAD to Housing Act removes key restrictions on build-to-rent
The bill removed earlier Senate provisions that would have barred institutional investors from an exemption and required a seven-year sell-off for new build-to-rent developments.
HousingWire reports that the 21st Century ROAD to Housing Act has reduced legislative uncertainty for the build-to-rent industry after the final bill removed Senate provisions that would have constrained new BTR communities.
The earlier Senate version included language that would have denied BTR communities an exemption from the institutional investor ban, and it would have imposed a seven-year sell-off requirement for new BTR developments. HousingWire reports that those added provisions, which were introduced in March, largely froze capital investment and effectively paused much of the new project pipeline.
According to Alex Chalmers, managing partner at Material Capital Partners, the sell-off requirement created a pinch point for developers because land purchase timelines would not align with the regulation, making it harder to secure returns on new projects.
HousingWire reports that with the potentially harmful provisions stripped from the final text, capital is beginning to return to BTR projects, though questions remain about how quickly the industry can regain lost ground and how the Department of the Treasury will interpret the law’s exemptions.