PHOENIX — There won't be any cap on corporate ownership of homes in Arizona, at least this year.
The one bill given the best chance of approval — based on its Republican sponsorship — has been sidelined after it did not get a hearing.
Rep. Jeff Weninger who chairs the House Commerce Committee told Capitol Media Services there should be a discussion about whether the state needs to take action to ensure that private individuals have a reasonable chance to buy a home. But the Chandler Republican who made the decision not to give it a hearing, said he's not convinced that what's in HB 2325 is the way to go.
And without a committee hearing, the measure never got a chance to be debated by the full House, much less make it to the Senate — or the governor.
A bill to put a limit on corporate ownership of homes in Arizona failed to get a hearing, but its sponsor says he plans to bring a new version back to Arizona lawmakers next year.
Rep. Nick Kupper, who crafted the proposal, said he remains convinced that there is a need for some guardrails to keep institutional investors from snapping up single family homes before Arizonans have a reasonable chance of making a purchase. And he believes that limit on corporations should be 50.
But the Surprise Republican said there isn't the time in this session to craft something that will meet his goals and still be able to get sufficient support to become law. So Kupper is now focusing his attention on bringing back the plan in 2027.
Still, he acknowledged there is likely to always be opposition by some Republicans to any legislation that seems to restrict the right of people to buy and sell what they want. And Kupper said that likely will continue to exist — even with President Trump publicly supportive of such limits on the national level what he is hoping to do here.
At the heart of the issue is the concern that institutional investors — corporations, partnerships, investment trusts and other legal entities — have been buying up homes as they go on the market. They generally have an advantage over families because they can make all-cash offers.
Complicating the problem is many of these are turned into rentals. That, in turn, reduces the number of homes available for purchase, further driving up prices.
Kupper proposed a two-pronged approach.
One would give other would-be homebuyers first crack, prohibiting institutional investors from making any bids for the first 60 days days a property goes on the market.
And the other would bar any such investor of owning more than 50 single-family homes in Arizona.
"If all the housing gets bought up over time by investment firms and they turn them into rentals, because it's more profitable for them long term, you won't have anything to buy,'' Kupper said. And he said the four largest firms that are doing this are buying up a combined 1,000 homes a year in Arizona.
"The more that happens, the smaller your available market is to sell homes because your prices get jacked up,'' Kupper said. "And the people who maybe could have afforded them are forced into rentals now.''
His bill was assigned to the House Commerce Committee — the one headed by Weninger. And that was the end of it.
"I commend Rep. Kupper for introducing HB 2325 and sparking discussion on prioritizing family homebuyers,'' Weninger said. But he said it was not suitable for approval.
"The 50-home cap seemed premature without more data on effects like supply and investment,'' Weninger said.
As it turns out, though, Kupper isn't the only one who thinks 50 is a good limit.
Even before he introduced his bill, Kupper had a conversation with House Minority Leader Oscar De Los Santos who was thinking along the same lines. And the Laveen Democrat introduced his own version, HB 2705, which uses that same figure, but with a difference: He would limit institutional investors to buying no more than 50 in any calendar year, with no absolute cap.
De Los Santos, however, had no better luck getting a hearing on his measure which was assigned to the House Government Committee.
That is not a surprise, given it is difficult for Democratic lawmakers to get their proposals advanced in the Republican-controlled legislature. But Kupper figured that, as a member of the GOP, he had a better chance.
That did not prove the case.
"His bill is a great first step in starting the dialog about corporate ownership of homes in Arizona,'' Weninger said. "I look forward to further discussions.''
Kupper said he has talked with Weninger about what it would take to make his proposal acceptable.
"And I don't think we were able to get where we both wanted yet,'' he said.
Part of the problem, Kupper said, appears to be concern among some Republicans to do anything that would seem to interfere with private property rights.
"That's a difficult thing,'' he said. "And that's where, when we work on it, we need to use a scalpel rather than a meat cleaver.''
But Kupper said he has a somewhat different attitude than some other members of the GOP caucus.
"Yes, conservatives, we tend to be free enterprise,'' he said. "But it doesn't mean we don't put in certain guardrails.''
Consider, he said, the fact that there are various laws designed to regulate monopolies to prevent them from controlling a market and being able to use their size and influence to make their own rules. The key, said Kupper, is crafting something with minimal interference.
"So I think there's a way forward,'' he said.
"I'm not sure exactly what that looks like at this point,'' Kupper continued. "But I think we can get to a strong bipartisan solution on it.''
All this is occurring against the backdrop of what Trump is advancing at the federal level.
In January he issued an executive order directing federal agencies to take steps to limit the purchase of single-family homes by "large institutional investors.''
That, however, has only limited effect as it deals with actions by federal agencies under his purview who can approve and guarantee loans. And, similar to what is in Kupper's bill, it directs those federal programs to promote sales to individuals by giving owner-occupants and nonprofits a 30-day window to bid on foreclosed properties.
Trump, in his State of the Union speech this past week, asked Congress to put the concept into federal law, with the administration circulating a memo asking for a statute that prohibits investors who now own more than 100 homes from purchasing more.
"We want homes for people, not for corporations,'' the president said. "Corporations are doing just fine.''
Kupper said he doesn't believe that what Trump is proposing — even if it gains congressional approval — negates the need for state legislation.
"Maybe they're both complementary,'' he said. "Maybe his needs to reach one aspect and, if I can get my bill going for Arizona, it reaches a different aspect of this concern.''
