Nevada legislature risks loss of the American dream
Legislation capping private sector investment in housing makes it harder to afford a good home and threatens evictions.
State legislatures are debating various proposals to address the housing affordability crisis. One badly flawed idea appearing across state houses aims to restrict who can own and manage single-family rental (SFRs) homes. These efforts may be well- intentioned, but they are a misguided approach to lowering housing costs. Perhaps most importantly, these proposals ignore the people most directly impacted: the families renting these homes.
For millions of Americans, SFRs aren’t chess pieces to score political points – they are homes where people can grow their families and live closer to work. These rentals provide a bridge to homeownership for many families and are an essential steppingstone to stability and greater opportunity. During a time of high mortgage rates, complex zoning regulations, and limited supply, SFRs increase access for hard-working families to live and thrive in safer neighborhoods that offer better schools and more opportunities to climb the socio-economic ladder.
Nevada is grappling with a housing shortage. Yet, its state legislature is considering harmful legislation that would not tackle the root cause of the issue, which is the lack of housing supply. In fact, this proposal would make things worse. It would make it harder for Nevadans to access a home, or even threaten to evict families living in SFRs, who may be unable to afford a down payment in the same neighborhood.
THE LATEST IN NEVADA:
Nevada state legislators proposed harmful legislation, SB 391, that would create a landlord registry and caps the number of homes professionally managed rental providers can purchase and rent out in a year. This legislation is a misguided attempt to make housing more affordable for Nevadans. While the legislation may be well-intended, it would have the opposite effect and restrict the supply of affordable housing that provides families with a bridge to the American Dream. If enacted, SB 391 will not only limit the development of diverse housing stock, but rental providers may also leave communities and be forced to immediately evict families living in SFRs. Academic researchers in the state acknowledge that Nevada’s housing affordability crisis is driven by high interest rates and “the scale of the U.S. housing shortage.” Due to supply chain disruptions and the COVID-19 pandemic, Shawn McCoy, the director of UNLV’s Lied Center for Real Estate, explained that “housing growth and development did not keep up” with population growth.
With a limited housing supply and high mortgage rates, renting a home is cheaper than
buying one in many markets, including Las Vegas. At the end of 2024, Realtor estimated that Las Vegas residents were saving approximately $1,287 per month by renting. SB 391 will only make it harder for families to access and afford housing.
THE DATA IS CLEAR: SFRs CREATE A PATHWAY FOR PEOPLE TO PURSUE THE AMERICAN DREAM
Every family deserves the opportunity to choose from a diverse and affordable set of housing options, including SFRs. The benefits of a diverse housing stock are evident. Researchers from Virginia Tech University and the University of North Carolina-Charlotte found that an increase in the supply of SFRs opens the door for more children to access and enroll in high-performing schools. Research from Harvard University highlights how access to these opportunities creates a path for upward mobility.
Proponents of legislative efforts to limit professionally managed rental providers in the housing market argue that their investments greatly distort the marketplace. This is a false narrative. According to Matthew Yglesias, institutional investment is “genuinely quite small relative to the scale of the single-family home market.” Ezra Klein suggested the same in a recent podcast, explaining institutional investors are “an extremely small part of the market right now and is just not the main problem in housing.” The Government Accountability Office (GAO) also found that institutional investors own only two percent of all SFRs in the nation, suggesting that smaller entities operate most single-family homes.
These proposals may sound good on paper, but they are not the solution to reducing housing costs and risk displacing millions of Americans living in SFRs. These bills would worsen access to housing and unintentionally force renters out of their homes, with limited options to find a home due to tight supply, inflated prices, and elevated interest rates.
Policymakers must listen to families most impacted by these legislative proposals and redirect their focus to tackling the root cause of the affordability crisis by enabling private sector investment in the housing market. Embracing private sector investment will boost diverse housing options, including SFRs. SFRs provide housing options and a bridge to homeownership, and we can’t stand for threats that will take away opportunities for families instead of addressing why families can’t afford to buy homes in the first place.
