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No renting at all? Why buy a home then? You’re just setting yourself up to become trapped in a bad situation. If you don’t have the flexibility to rent out your property when you get a new job somewhere else, or lose your job and can’t cover the mortgage, then you’ll either be foreclosed on or forced to sell possibly at a loss. Remember, when you buy a property, you are immediately under water due to selling costs of 6-8% of the property’s value.
Let’s picture this scenario:
If renting isn’t an option, this rule would create a lot of problems for people. The solution isn’t to regulate what people do with their own property more, but to build more housing supply. Your idea would disincentive building housing because it can’t be rented unless you’re in that special 5%.
Edit: Guaranteed everyone downvoting me has never owned a property and has not a clue what the stakes are.