HR-7753-119
Referred to the House Committee on Financial Services.
Sponsored by Tom Barrett (R-MI)
What it does
This bill would require federal housing entities — including the FHA, FHFA, Fannie Mae, Freddie Mac, and USDA — to give first-time homebuyers exclusive access to foreclosed 1-to-4 unit residential properties for 15 days after listing. During that window, the property must be priced at fair market value (based on a recent appraisal or broker opinion), listed on a publicly accessible website, and cannot be bundled with other properties. Covered entities would be required to issue implementing rules within one year and submit biannual reports to Congress on outcomes.
Who benefits
First-time homebuyers, particularly those in competitive markets where institutional investors often outbid individual buyers on foreclosed properties. Lower- and middle-income prospective buyers who are more likely to be purchasing their first home. Communities where high rates of investor purchases of foreclosed homes have contributed to reduced owner-occupancy rates. Real estate agents and mortgage brokers who work with first-time buyers. Neighborhoods that may see increased owner-occupancy and associated community stability.
Who is hurt
Institutional investors and real estate investment firms that currently purchase foreclosed properties quickly and in bulk — they would lose immediate access to these properties for 15 days. Bulk buyers who rely on property bundling would be prohibited from doing so during the window. Covered federal entities may face administrative costs to implement new rulemaking, reporting, and verification systems. Taxpayers who fund these agencies could bear those administrative costs. Repeat or move-up homebuyers who do not qualify as first-time buyers would be excluded from purchasing these properties during the 15-day window.
Supporters argue
Supporters argue that institutional investors have systematically outcompeted first-time buyers in the foreclosed home market, purchasing properties within hours of listing — often in cash and in bulk — before individual buyers can arrange financing or even schedule a viewing. They contend that federal agencies holding foreclosed properties have a public interest obligation to prioritize owner-occupancy, and that a standardized 15-day window levels the playing field without permanently restricting the market. They point to HUD's existing but inconsistently applied "First Look" program as evidence that the concept works and simply needs statutory teeth and uniform standards.
Opponents argue
Opponents argue that restricting buyer eligibility for 15 days may slow property sales, prolonging the time foreclosed homes sit vacant — which can accelerate neighborhood blight and reduce property values for surrounding homeowners. They contend that fair market value pricing requirements and appraisal mandates add administrative complexity and cost that could reduce the net recovery on distressed assets, ultimately increasing losses borne by federal mortgage programs and taxpayers. They further argue that the bill addresses a symptom of broader housing supply constraints, and that restricting investor access does not create new housing units or meaningfully expand affordability.
Constitutional context
Congress has broad authority to set conditions on the sale of federally owned or controlled property under its property power (Art. IV, §3, cl. 2) and to regulate the activities of federal instrumentalities like Fannie Mae and Freddie Mac. No significant constitutional tension is present, as this bill governs the disposition of property already held by federal entities rather than imposing mandates on private parties.
Checks and balances
The executive branch (through covered federal entities and their Inspectors General) gains new administrative responsibilities; Congress retains oversight through mandatory biannual and annual IG reports, and the public gains transparency through required website disclosures.
Historical precedent
HUD has operated a voluntary "First Look" program since 2010 under the Neighborhood Stabilization Program, giving owner-occupants and nonprofits priority access to FHA-foreclosed homes before investors, but participation and enforcement have been inconsistent across agencies.