Nevada City Virtual Tour

Wednesday, October 26, 2011

Buy A House, Get A Visa Foreign Investors and Investments

Attention Canadian snowbirds, well-heeled Brazilians and boom-era Chinese nationals looking for a little piece of that increasingly elusive thing called “The American Dream.”

America has your number and, literally, it’s $500,000.

In a comprehensive bill that aims to spur foreign travel and spending in the U.S., Senators Charles E. Schumer (D-NY) and Mike Lee (R-UT), have proposed providing a three-year residential visa to foreign nationals who invest at least $500,000 in residential real estate in the U.S. At least $250,000 must be spent on a primary residence where the visa holder will live for at least 180 days out of the year while paying taxes to the U.S.

Investor Warren Buffett offered an early version of this real estate inducement back in August. During an interview on PBS, Buffett suggested that if the U.S. altered policy and opened the door for “rich immigrants,” those resources would be welcomed in a struggling U.S. economy, especially in the area of residential housing.

Inducements for foreign national purchase of U.S. real estate is seen another important step towards bolstering prices and shoring up markets in foreclosure-centric areas.

“There is no silver bullet out there. And really, the path forward is a lot of small steps like this that we’re going to take,” according to Stan Humphries, Zillow’s chief economist.

Real estate analysts have said this proposal could lift demand for U.S. homes and help ease the housing crisis. According to Humphries, foreigners spent more than $80 billion on U.S. homes last year, a 24 percent increase from the year before. A quarter of those buyers were Canadian. Another 25 percent of foreign investors in residential U.S. property is made up of investors from China, Mexico, United Kingdom and India — a percentage that could be boosted should the proposal become law.
The proposal has gotten the thumb’s up from the U.S. Chamber of Commerce, the U.S. Travel Assocation and the American Hotel & Lodging Association.

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