Owning a Home Still An American Dream..At Least for Immigrants
NEW YORK (TheStreet) -- Immigrants are likely to be a steady source of demand for homes in the next decade, according to a new report sponsored by the Mortgage Bankers Association's Research Institute for Housing America.
While foreign investors have been grabbing all the headlines for their role in the housing recovery over the past year, immigrants long settled in the U.S. have, in fact, played a significant role in the growth in housing over the last few decades.
The number of immigrant homeowners has increased from 800,000 in the eighties, to 2.4 million between 2000 and 2010 and is projected to rise further to 2.8 million by 2020.
Immigrants accounted for 82.2 percent and 65.1 percent, respectively, of the growth in homeowners in the states of California and New York between 2000 and 2010.
The study makes no distinction between immigrants based on their legal status.
Housing analysts have cited favorable trends in household formation as one reason to be optimistic about future home prices.
As the economy recovers, young adults hurt by the recession are expected to finally move out of their parents homes. Then there is the 80-million strong echo boom generation- the sons and daughters of baby boomers- that will also contribute to household formation.
But immigrants are also expected to be strong contributors to household formation.
Between 2010-2020, immigrants nationwide are projected to account for 32.2 percent of the growth in all households, including 35.7 percent growth in homeowners and 26.4 percent growth in renter households, according to the report.
Foreign-born ownership demand is projected to remain a majority of the growth in six states: California, New York, New Jersey, Massachusetts, Connecticut and Michigan.
The longer they are settled, the more likely they are to buy homes. For example, among the cohort of Hispanics who arrived in the U.S. during the 1980s, homeownership rose from above 15% in 1990 to nearly 53% in 2010 and is projected to rise above 61% in 2020.