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Proposal to tax large institutional owners of single‑family homes draws sharp pushback
Summary
Representative McCollum’s HB 1228 would tax large institutional owners of single‑family rental homes at a higher ad valorem rate and divert proceeds to local homestead relief; real‑estate groups backed the idea but builders, operators and landlords warned it could shrink supply, cause divestiture and raise rents.
Representative McCollum presented House Bill 1228 (LC 95 90301) as a two‑part approach: enacting companion legislation to establish a different tax class for large institutional owners of single‑family residential rental property and placing a constitutional amendment before voters to allow a 100% evaluation on those properties while leaving smaller "mom‑and‑pop" owners taxed at lower rates. McCollum said institutional investors own large portfolios (he cited a figure of 83,000 homes) and that the measure would redirect proceeds to reduce homestead tax burdens in the counties affected.
Proponents at the hearing included Betsy Bradfield of the Georgia Association of Realtors, who said the association supports a tax approach to "level the playing field" and that tighter affiliate language in the current draft addresses prior concerns about evasion. Bradfield said the approach aims to protect local mom‑and‑pop landlords and homebuyers.
Opponents — including the Home Builders Association of Georgia, Quinn Residences, ARC Homes for Rent and other institutional operators — warned of unintended consequences. Austin Hackney (Home Builders) said the bill creates a new class of property owners and risks reducing housing supply; Richard Ross (Quinn Residences) and John Isaacson (ARC Homes) said a jump from a 40% assessment to 100% would overwhelm business models or force divestiture. Isaacson added that many build‑to‑rent developments are financially tied to institutional capital and that abrupt changes could halt projects that also support for‑sale housing.
Committee members pressed authors and witnesses on enforceability (affiliate rules, triggers), the possibility of a prospective approach versus retroactive treatment, and the potential fiscal impacts on state pension funds and local tax digests. Several members suggested a prospective, class‑based definition tied to revenue generating property rather than an arbitrary unit threshold. The author said the bill is intended to level the field and protect owner‑occupied homeownership, not to ban institutional ownership outright.
No vote was taken; HB 1228 received a first‑hearing airing with extensive public testimony and cross‑examining questions from committee members. Stakeholders from both sides agreed to follow up with legal, fiscal and implementation details before further consideration.
