Bill Description: House Bill 904 would prohibit voluntary transactions involving the sale of single-family homes to foreign citizens and corporations, including real estate investment trusts with a majority of foreign shareholders.
Rating: -6
Does it give government any new, additional, or expanded power to prohibit, restrict, or regulate activities in the free market? Conversely, does it eliminate or reduce government intervention in the market?
House Bill 904 would create Section 55-116, Idaho Code, to ban a “foreign person” from purchasing or acquiring a controlling interest in any single-family home. This prohibition would broadly apply to anyone who is not a citizen or legal resident of the U.S., including foreign corporations, foreign governments, real estate investment trusts with a majority of foreign shareholders, investment advisers acting on behalf of foreign clients, and “any other corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, agency, or instrumentality, or any other legal or commercial entity, acting on behalf of a nonresident alien, foreign corporation, or foreign government, or an agent, trustee, or fiduciary thereof.”
While this limitation is structured around prohibited buyers, it similarly restricts sellers, limiting owners from selling their property to interested foreign parties or investors.
(-1)
Does it increase barriers to entry into the market? Examples include occupational licensure, the minimum wage, and restrictions on home businesses. Conversely, does it remove barriers to entry into the market?
The bill would create explicit nationality- and citizenship-based barriers. Entire classes of buyers would be barred from owning single-family homes or investing in the single-family housing market.
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Does it violate the principle of equal protection under the law? Examples include laws that discriminate or differentiate based on age, gender, or religion, or that apply laws, regulations, rules, or penalties differently based on such characteristics. Conversely, does it restore or protect the principle of equal protection under the law?
The entire purpose of this law is to create an unequal playing field, where certain market participants are banned from participating in voluntary transactions with willing sellers based on nationality, citizenship, or incorporation location.
(-1)
Does it directly or indirectly create or increase penalties for victimless crimes or non-restorative penalties for non-violent crimes? Conversely, does it eliminate or decrease penalties for victimless crimes or non-restorative penalties for non-violent crimes?
Under this law, any property held in violation of the section would be sold through judicial foreclosure. “Proceeds of the sale shall be disbursed to lienholders, in the order of priority, except for liens that, under the terms of the sale, are to remain on the property.”
Even if a foreign person or entity legitimately acquired property “by devise, by descent, through the enforcement of security interests, or through the collection of debts,” they would be required to “sell, transfer, or otherwise divest itself of the property within one hundred eighty (180) days of acquiring control of the property” or face judicial foreclosure.
(-1)
Does it increase government redistribution of wealth? Examples include the use of tax policy or other incentives to reward specific interest groups, businesses, politicians, or government employees with special favors or perks; transfer payments; and hiring additional government employees. Conversely, does it decrease government redistribution of wealth?
The bill would create a troubling whistleblower provision that allows any individual to “act as a whistleblower and provide a referral to the office of the attorney general for violations of this section.”
If a whistleblower referral results in a divestiture of land or other assets held in violation of this section, the whistleblower shall be entitled to a reward equal to thirty percent (30%) of the proceeds of the property sale resulting from a violation of this section after disbursements have been made.
The whistleblower’s cut would be prioritized above paying proceeds to the foreign property owner.
(-1)
Does it violate the spirit or the letter of either the United States Constitution or the Idaho Constitution? Examples include restrictions on speech, public assembly, the press, privacy, private property, or firearms. Conversely, does it restore or uphold the protections guaranteed in the US Constitution or the Idaho Constitution?
Both the U.S. and Idaho Constitutions protect the right to acquire, hold, and dispose of property. The bill imposes a categorical ban on acquisition and a forced-sale mechanism for an entire class of persons based solely on nationality/status, directly restricting private-property and contract rights without individualized due-process findings of harm. The broad “foreign person” definition and retroactive divestiture requirements (even for inheritance or debt collection) further encroach on those guarantees.
(-1)
