Modifications to a bipartisan housing package currently before the U.S. Senate and House of Representatives have finally forced lawmakers from all sides of the political aisle to take up an issue long supported by a broad cross-section of their constituents — limiting “large institutional investors” and Wall Street banks from buying up single-family homes, which critics say reduces inventory and raises prices for repeat and first-time homebuyers.
In many ways, critics are right. In competitive markets, investors buying homes to hold as rentals or renovate and resell at a higher price frequently compete with first-time homebuyers — who also eye the for-sale listings that present the best relative affordability or value. In bidding wars again...