The U.S. housing market is in turmoil, and Senate Republicans have crafted legislation they believe will help boost the market by making it more inviting to foreign property investors. The bill, sponsored by Sens. Charles Schumer (R-NY) and Mike Lee (R-UT), will offer foreign homebuyers a 3-year visa if they spend $500,000 or more in cash on a home and live in the residence for at least 180 days. The lawmakers contend the visa is not a path to citizenship, and is designed to alleviate immigration concerns for well-established foreigners who want to move to the United States to live, work and retire, and contribute tax dollars as they do so. For more on this continue reading the following article from TheStreet.
A new Senate bill would help spur demand in U.S. housing by offering foreign investors a three-year "homeowners visa" if they invest half a million dollars cash and stay in the house for 180 days, co-sponsor Sen. Charles Schumer told CNBC Monday.
"We all know housing is dragging down our economy and the problem is basic supply and demand," said the New York Democrat.
The bill, co-sponsored with Mike Lee, a Utah Republican, "simply increases the demand. There are literally millions of people around the world, many of them retirees, some not, who would like to live here in America."
The residency requirement will force these investors to pay federal and property taxes, Schumer pointed out, and is intended to allay immigration concerns.
"We have to straighten out our immigration policy," Schumer said. "Immigrants are good for America. We should not just have people who cross the border illegally."
His visa bill is "not a path to citizenship," he stressed. But those who come using the visa can renew it every three years "as long as they stay in the U.S."
In the same interview, real estate mogul Richard Lefrak, head of the Lefrak Organization, who said he first suggested the "homeowners visa" idea three years ago, said the bill’s provision to make it easier for Chinese citizens to visit the U.S. will draw more monied entrepreneurs, which will prompt more U.S. investment.
He said that "40 percent of the wealthy people in China would like to leave. I mean they’re going to want to come here and they’re going to want to spend money and start businesses and buy the homes."
Same for the Brazilians, said investor Wilbur Ross, CEO of WL Ross & Co. "You’re already seeing it in Florida," he said, noting that 20% of all the residential real estate sales in Miami last year was by Brazilians.
He and Lefrak said the residency requirement may scare some investors away but acknowledged having that provision makes the bill politically palatable.
"If we tap some of the wealth in Asia, think how it would help housing" in California, Las Vegas, Florida and other troubled real estate markets, Lefrak said. "Any bill that has the support of Sen. Schumer and Sen. Lee, on opposite sides of the political spectrum, means there’s some merit to the idea."
This article was republished with permission from TheStreet.