Tennessee investor-purchase bill passed 31-1, then died
Tennessee investor-purchase bill passed 31-1, then died
2026-09-19 · Tennessee · Legislation · Did not pass
A Tennessee bill restricting bulk corporate purchases of single-family homes for rental passed the Senate 31–1 in March 2026 and was dead within 48 hours, killed in a House subcommittee where no member would second a motion on it. It is the sharpest example in the 114th General Assembly of a measure that carried one chamber and could not clear five members of the other.1
The two-year arc is worth setting out in order, because the bill's near-miss is easy to misread as a narrow defeat. It was not narrow anywhere except in the room that ended it.
What the act would have done
HB 298 was filed by Representative Behn and SB 242 by Senator Oliver, both on January 22, 2025. The General Assembly's own abstract describes the measure as one that
“enacts the ‘Homes not Hedge Funds Act’; prohibits certain business entities from purchasing more than 100 single-family homes in certain counties in this state for purposes of renting the purchased properties; establishes a state and private cause of action and establishes damages for violations.”
The Senate bill drew an unusually broad co-sponsor list across both parties — Senators Campbell, Akbari, Bowling, Lamar, Reeves, Rose, Seal and Yarbro joined Oliver. The Senate adopted Amendment 1 (SA0555) before passing it, so the version that cleared that chamber differs from the version filed; we have not read the amendment, and the description above is of the bill as introduced.
Two days, two opposite outcomes
The bill sat through the 2025 session, deferred in Senate State and Local Government on March 18, 2025 “to first calendar of 2026.” In Tennessee's two-year assembly that deferral is survivable, and the bill duly returned.
On March 3, 2026 the Senate committee recommended it for passage with amendment, 7 ayes, 0 nays, 1 present and not voting. On March 9, 2026 the Senate adopted the amendment and passed the bill 31–1. It was engrossed the same day.
On March 11, 2026, the House companion failed for lack of a second in the Cities and Counties Subcommittee. On March 12, the Senate-passed bill arrived in the House and was held on the desk, where it stayed until the assembly adjourned sine die on April 23, 2026.2
A failure for lack of a second is not a defeat on the merits. It means a motion was made and no second member would join it, so no vote was taken and no position was recorded. It is the least accountable way for a Tennessee bill to end and, in this session, one of the most frequently used.
Why this is association news
The bill said nothing about associations, declarations or covenants. Its subject was who may buy single-family houses at volume in specified counties, and the Community Associations Institute tracked and opposed it on that basis.3
The connection is ownership composition inside a covenanted subdivision, and it works through three mechanisms that are structural rather than speculative.
Voting and quorum. Declarations allocate votes to lots. A single entity holding a substantial block of lots holds the corresponding block of votes, which bears on board elections, on amendment thresholds, and on the supermajorities Tennessee law requires for certain actions — including the two-thirds approval that Part 7 of Title 66, Chapter 27 requires for special assessments on certain amenities.
Candidate supply. Tennessee associations are run by volunteer directors drawn from the owners. A subdivision whose lots are held for rental has a smaller resident-owner pool from which to draw them, and Tennessee imposes no statutory director qualifications that would address the composition of a board in such a community.
Enforcement economics. Covenant enforcement against a single owner-occupier and against an institutional owner of many lots are different exercises. The second concentrates both the association's assessment income and its enforcement risk in one counterparty.
None of that was before the legislature as an association question, and nothing in the record suggests the sponsors framed it that way. It is why a housing-market bill appears on a community association tracker.
The county limitation is the unresolved part
Both the threshold and the geography were limited: more than 100 single-family homes, in “certain counties.” The abstract does not specify which counties, and Tennessee bills of this kind commonly use population brackets keyed to a federal census to identify them without naming them.
Because Amendment 1 was adopted before passage and we have not read it, neither the final threshold nor the final county list can be stated. What the bill did carry, on the abstract's own terms, was a dual remedy — a state cause of action and a private one — which is a more aggressive enforcement design than a registration or disclosure requirement.
A pattern, not an incident
The same sequence ran on a second measure in the same assembly. The Tennessee Homebuyer Harassment Prevention Act, HB 565 and SB 204, would have limited repeated unsolicited offers to buy a property. The Senate passed it 29–1 on March 10, 2025. The House companion was taken off notice two days later, revived a year on, and failed for lack of a second in the Banking and Consumer Affairs Subcommittee on March 18, 2026.4
Two housing-market bills, both passing the Senate by better than 29–1, both ending in a House subcommittee without a recorded vote. The chamber split, not the party split, is what the record shows.
What to watch next
Neither bill survives into the 115th General Assembly, which convenes in January 2027. Both would need refiling from the beginning.
The Senate co-sponsor list on SB 242 is the detail most likely to matter to a refiled version, because it crossed party lines and because near-unanimous chamber passage twice in two sessions is a strong base to start from. The obstacle both bills met was the House committee calendar, and nothing in the record indicates what would change that.
Related Tennessee HOA Topics
- SB 242 bill history, abstract, sponsors and votes (Tennessee General Assembly) ↩
- HB 298 bill history and subcommittee action (Tennessee General Assembly) ↩
- “2026 Tennessee End of Legislative Session Report,” Community Associations Institute Advocacy ↩
- SB 204 / HB 565, Tennessee Homebuyer Harassment Prevention Act — bill history (Tennessee General Assembly) ↩
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