SAVING THE AMERICAN DREAM: ADAPTING ANTI-CORPORATE FARMING LAWS TO PROTECT SINGLE-FAMILY HOUSING

Throughout the twentieth century, several states adopted a new type of laws: Anti-Corporate Farming (ACF) laws. These laws generally prohibit corporations from owning farmland or engaging in the business of farming. They were originally intended to “encourage and protect the family farm as a basic economic unit” and “insure it as the most socially desirable mode of agricultural production.” While subject to criticism, these laws generally pass constitutional muster and remain active components of state-level corporate regulatory schemes.

Today, America faces a new wave of corporate consolidation—in single-family rental (SFR) housing. In the wake of the Great Recession, institutional investors, taking advantage of new financial instruments and federal government policy, purchased large numbers of homes out of foreclosure, a trend that continues today. Most proposed solutions to this problem have been evenhanded regulations that focus on tenants: expanded rent control laws, stronger eviction protections, and financial disincentives for Corporate Landlords.

This Note argues that states should consider restricting corporate ownership of SFRs, using ACF laws as a model. Previous scholarship has identified expanded ACF laws as a solution to current trends of consolidation in rural land. But this Note is the first to argue that ACF laws can also be adapted to the residential context to limit corporate ownership of single-family rental housing.

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* J.D./LL.M. Candidate 2025, Columbia Law School and Institute for Law & Finance, Goethe University Frankfurt am Main. The author would like to thank Professor Katharina Pistor for her guidance and wisdom during the writing process, Matthew Schneider for his feedback, and the staff of the Columbia Law Review for their careful edits. Special gratitude to Lucy Kirichenko for her unwavering support and encouragement and to Bradley and Jane Knorr for their lifelong inspiration.

Introduction

Throughout the twentieth century, several states adopted a new type of laws: Anti-Corporate Farming (ACF) laws. These laws, adopted in waves throughout the century, 1 See infra section I.A. generally prohibit corporations from owning farmland or engaging in the business of farming. 2 E.g., Minn. Stat. § 500.24 subdiv. 3 (2024). Some early ACF laws were passed during the Great Depression, when corporations consolidated massive tracts of land through farm foreclosures. 3 See infra section I.A. More recent ACF laws were enacted in the 1970s, when similar patterns of consolidation led lawmakers to seek to “encourage and protect the family farm as a basic economic unit” and to “insure it as the most socially desirable mode of agricultural production.” 4 See Minn. Stat. § 500.24 subdiv. 1. ACF laws, while subject to constitutional challenges 5 See infra section I.C. and criticism, 6 See infra section I.D. still stand as valid constraints on corporate activity. 7 See infra section I.C. And they remain active parts of state legislative schemes—North Dakota, which enacted one of the first ACF laws, made sweeping amendments to its law in April 2023. 8 See Burgum Signs Bill Modernizing State Law to Encourage Growth in Animal Agriculture in North Dakota, N.D. Off. of the Governor (Apr. 28, 2023), https://www.governor.nd.gov/news/burgum-signs-bill-modernizing-state-law-encourage-growth-animal-agriculture-north-dakota [https://perma.cc/YX49-PHJV].

Today, America faces a new wave of corporate consolidation—in single-family rental (SFR) housing. In the wake of the Great Recession, 9 “Great Recession” refers broadly to the financial crisis starting in 2007, when a series of foreclosures caused a collapse in the mortgage-backed securities market and a broader economic recession. See John Weinberg, The Great Recession and Its Aftermath, Fed. Rsrv. Hist. (Nov. 22, 2013), https://www.federalreservehistory.org/essays/great-recession-and-its-aftermath [https://perma.cc/NE98-E9PT]. institutional investors, taking advantage of new financial instruments and federal government policy, purchased large numbers of homes out of foreclosure. 10 See infra section II.A. This “financialization” push continues today. Private equity firms, banks, and other financial institutions (collectively, “Corporate Landlords”) buy up single-family houses—either directly or by purchasing packages of mortgages—and convert them into rental property to earn a profit. 11 See infra section II.A. This financialization of single-family rentals has been cited as the source of increased rents, heightened rates of eviction, and increased costs of living. 12 See infra section II.B.

Most proposed solutions to this problem have been evenhanded regulations that focus on tenants—expanded rent control laws, stronger eviction protections, and financial disincentives for Corporate Landlords. 13 See infra section II.C. Yet, with the exception of a lone bill proposed in Minnesota, 14 See H.F. 685, 93d Leg. (Minn. 2023). Minnesota’s bill only bans one specific activity—corporations converting single-family housing into rental property. Id.; see also infra section II.C.6. policymakers overlook another solution: restricting corporations from acting as landlords entirely. This Note argues that states should consider adopting such restrictions, using ACF laws as a model. Previous scholarship has identified expanded ACF laws as a solution to current trends of consolidation in rural land. 15 See, e.g., Vanessa Casado Pérez, Ownership Concentration: Lessons From Natural Resources, 117 Nw. U. L. Rev. 37, 59–61 (2022) (evaluating ACF laws for conservation contexts); Megan Dooly, Note, International Land Grabbing: How Iowa Anti-Corporate Farming and Alien Landowner Laws, as a Model, Can Decrease the Practice in Developing Countries, 19 Drake J. Agric. L. 305, 318–21 (2014) (applying ACF laws in international agricultural contexts); Stephen George, Comment, Not for Sale: Why Congress Should Act to Counter the Trend of Massive Corporate Acquisitions of Real Estate, 6 Bus. Entrepreneurship & Tax L. Rev. 97, 112–13 (2022) (arguing for a federal ACF law to protect farms). But this Note is the first to argue that ACF laws can also be adapted to the residential context to limit corporate ownership of single-family rental housing.

This Note proceeds as follows: Part I introduces ACF laws and their history, reviews their main provisions, and discusses challenges to their constitutionality and normative validity. Part II then explains the financialization of single-family housing in the United States: its genesis in the wake of the Great Recession, the costs of financialization, and the solutions that have previously been proposed. Finally, Part III argues that legislatures can use ACF statutes as a model for restrictions on Corporate Landlords, offers normative arguments for their effectiveness, and proposes statutory language for legislators to consider.