Dispelling the Myth: Wall Street Isn’t Acquiring Main Street—Here’s Why

Wall Street institutions can be difficult to defend, in large part due to the myriad financial shenanigans that contributed to the 2008 Financial Crisis – such as being bailed out by taxpayers only to pay out exorbitant bonuses to executives before needing another bailout when COVID struck; not to mention all of their illicit and questionable legal schemes over time.

Lately, critics of high finance have emerged with one voice to condemn Wall Street for buying up houses across the nation to drive up prices and make homeownership unaffordable for most Americans.

Sen. Elizabeth Warren has made similar claims, among many Democrats. According to Warren, Wall Street is responsible for controlling “an extensive portion of the housing market”.

But many Republicans are also speaking out in support of such ideas; Texas Governor Greg Abbott for instance has called upon state legislatures to limit how many houses institutional investors can purchase, while across populist elements from both political parties there can be seen people criticizing Wall Street’s attempts at creating a “nation of renters.”

Wall Street stands innocent in this instance; unfortunately, due to this false impression, dubious legislation that would hurt small and mid-sized investors (and hence cities in which they invest or renovate homes) has been introduced as well as solutions to housing affordability in America being sidestepped in favor of political activism chasing after an empty red herring.

How Many Houses Has Wall Street Actually Bought? A simple glance at a graph depicting institutional buyers’ purchases would indicate that Elizabeth Warren and Greg Abbott may be overstating the problem.