Realtors: Crackdown on undocumented immigrants could affect housing market.
What does it say about a country that illegal aliens are propping up the housing industry? And don't get me wrong, during the housing bust - the stories I would hear from realtors about illegals buying houses and defaulting.... so I'm not saying it's a thing.
But if your economy is so screwed up that you have to count on illegals to prop up the market - I just have to shake my head.
Thankfully I doubt it's true because the media is complete idiots when it come to anything financial. Wouldn't that just make it slightly easier for Americans to buy a place? Isn't that what we want?
Subscribe to:
Post Comments (Atom)
"OMG THERE'S A POTENTIAL FIRST-ORDER EFFECT WE JUST THOUGHT OF! WE SHOULD HOWL LOUDLY ABOUT IT AS IF IT WERE REAL AND ACTUAL NEWS!"
ReplyDelete*ahem* :-)
Actually, if the American economy were that brittle in terms of these supposed first-order effects, we'd have seen that show in other ways by now.
Oh, but wait ...
"[Two puffed up talking heads for Big Realty Inc.] told ABC-7 they haven't seen a big impact on the housing market yet ..."
Let's apply Post Alley Crackpot's "Big Stanley", my chav version of Ockham's Razor, and simplify this to "no effect whatsoever".
"BUT BUT BUT ... MAYBE IF WE FLOAT A FEW TRIAL BALLOONS ONE OF THEM WILL TURN OUT TO BE LIKE THE HINDENBURG!"
But maybe not. :-)
Now imagine second-order effects that would result from releasing pressure on rental markets.
Rental prices may come down to the point that marginal rental properties exit the market.
Some of those properties may be repaired and put back on the market as cheap condos.
Those cheap condos release pressure on personal real estate, or ...
Imagine some of those marginal rental properties being redeveloped as commercial real estate.
Then those cheap commercial properties relieve commercial real estate pressure.
The eventual second-order effect is that premium locations retain most of their valuation and perhaps continue to gain, while everything else eventually reaches a tentative market equilibrium.
No, actually, I think everything will be quite good ... except for realtors. :-)
With approaching price stability, there's little need to hire estate agents in general because you're going to have to wait a while to sell your property anyway.
Now let's see if these two puffed up talking heads have jobs in two years. :-)
It wouldn't be the poor immigrants propping up the bottom of the housing market, it would be the sultans pulling out of Manhattan real estate. Correct me if I'm wrong, but real estate purchases are one of the few loopholes where you can pay cash for the transaction and the realtor, bank and everyone else involved isn't mandated to report it as suspicious. Less oil tycoons and drug lords trying to hide money from their own governments would mean crash at the top. In California's central valley, I think things swing the other way on the bottom. Two people earning minimum wage is maybe $2k per month. You can barely afford food for a family if you are poor. At $15 per hour though, it's almost $4k per month, which covers necessities and gives you $1k to save. People who scrape to get by will invest it in homes for their families. Anything residential in the five figures in farming communities will double or triple as the workers transition to homes and take on $1k mortgages. In that sense, I see immigration helping real estate, even if its the immigration that has already occurred. df
ReplyDeleteI think in a healthy functioning economy this should be statistically insignificant. Yet - we are not in a healthy functioning economy. Even if people have grown so used to it they believe this is what the world is like. You can't help but look at Canada and wonder how much of that is going on here. They made a new tax on outside buyers and the market pulled back. It isn't unreasonable to think that is also happening here. Yet - if a few farmers in the South, H1-B visa holders and some sultans of cash can make any difference at all - it's the saddest thing I've ever seen. That's ridiculous.
ReplyDeleteAs far as this though, "Rental prices may come down to the point that marginal rental properties exit the market.".
This should also be statically insignificant. Anyone who was able to hold on through the recession has balls of steel. (I'm in that camp) So only people that have bought in since should be an problem at all. And if those people can affect the market, that is also sad. But where I used to see 15 houses for sale in my neighborhood a handful of years ago. Now the average is only 2-3. The lack of supply is real.
I think the reporter is probably wrong, but I can't actually say that for sure since the market is pretty dysfunctional right now. When interest rates go up, this market is going to be so locked up it will make everyones head spin.