patrick.net

hrhjuliet says

I have a group of friends and colleagues working on a legislation to create limitations on foreigners buying American real estate

Legislation? Is that a joke?

If someone doesn't like high prices, they should rather change the large number of existing American legislation that are designed precisely to create high prices: tax breaks, constraints on new constructions, efforts to limit foreclosures, various mortgages subsidies, monetary policy, etc...

Why would someone lose time addressing a small side issue?

cloud15 says

I'm a legal immigrant . The planet belongs to all of us. What makes you special hrhjuliet ? Just because you were born here ?

Clearly you did not bother to read the article.

Heraclitusstudent says

hrhjuliet says

I have a group of friends and colleagues working on a legislation to create limitations on foreigners buying American real estate

Legislation? Is that a joke?

If someone doesn't like high prices, they should rather change the large number of existing American legislation that are designed precisely to create high prices: tax breaks, constraints on new constructions, efforts to limit foreclosures, various mortgages subsidies, monetary policy, etc...

Why would someone lose time addressing a small side issue?

I agree that the whole system needs overhauling, but this is still a very important issue and worth all of their effort.

hrhjuliet says

I agree that the whole system needs overhauling, but this is still a very important issue and worth all of their effor

No it is trivial. Years ago people were up in arms about this regarding Japan. Actually I think Great Britain own the most US land.

In many Asian countries, there are a lot of restrictions on foreigners, holding RE there without a local business connection.

On the other hand, places like City of London have been historically, money laundering centers for many of world's wealthy, even pre-dating the East India Company, the main holding company for the Empire's overseas expansion. Thus, this world capital diversification has been a part of Anglo-Saxon history for quite some time, and the US, Canada, Australia, & NZ are all a part of that business heritage.

America is having a fire sale. Why not sell wealthy foreigners the right to live here, too?

That’s the notion behind a bill introduced last week by Republican Senator Mike Lee of Utah and Democrat Senator Charles Schumer of New York: Stoke demand for American homes by allowing foreign nationals to buy them. In return, give foreigners the right to live here (although not work here).

The price? At least $500,000 cash. It could be one piece of real estate costing $500,000 or more, or several, of one would have to be worth at least $250,000.

Presumably, this would help homeowners by boosting demand. “This is a way to create more demand without costing the federal government a nickel,” Schumer told the Wall Street Journal.

And it would help the Street. Rather than have the big banks carry all those non-performing mortgage loans on their books or be forced to write them down, we’ll just goose the housing market by selling off the right to live in America.

And the measure wouldn’t allow in the world’s riff-raff, because buyers would have to be rich enough to pay cash, and live here six months a year without working.

Realtors love it. Says Glenn Kelman, CEO of Redfin, an online brokerage firm, “when property values sag and this is a desirable place to live, one of the simplest solutions is just to let more people in so they can buy the homes.”

In Seattle, where Kelman lives, housing prices have slumped – as they have all over America. But Vancouver, Canada – just 140 miles to the north – is enjoying a housing boom because Canada allows foreigners to buy their way into Canada, just as the Lee-Schumer bill would do here.

But wait a minute.

Rich foreigner buyers may be a boon to American homeowners looking to sell, because those homeowners can’t find Americans willing and able to fork over as much money as the sellers would like.

But what about American home buyers – many of them young, just entering the market – who would prefer low home prices that aren’t bid upward by rich foreigners? It’s not altogether obvious why we should favor American homeowners over American home buyers.

The visa-for-home swap proposal also comes at exactly the same time the nation is actively closing its doors to foreigners who aren’t wealthy. Is this what America is all about?

Policy makers have tightened eligibility for entering the country legally. Student visas are harder to obtain. Family members are waiting years to become resident aliens. Green cards are in short supply.

Meanwhile, many states are doing whatever they can to make immigrants – mostly poor, but legal as well as illegal – feel unwelcome. For example, Alabama and Arizona allow police to demand “papers, please” from anyone they suspect may be undocumented (read: anyone who looks Hispanic). Alabama requires public schools to demand documentation from parents of all children in K-12 programs.

The nation is expelling record numbers of undocumented workers. Over the last year (from October 1, 2010 to October 31, 2011), almost 400,000 people were deported – the largest number in the history of the Federal Immigration and Customs Enforcement Agency. Annual deportations have increased 400 percent since 1996.

Some of these people committed criminal acts in the United States but a significant number simply overstayed their visas. Others had been in America for decades, working and raising their families here. Some had even been here legally but had no opportunity to defend themselves. A recent report by my colleagues at the Berkeley Law School notes that many immigrants “are pushed rapidly through the system without appropriate checks or opportunities to challenge their detention and/or deportation.”

If the Schumer-Lee bill becomes law, the easiest way for a foreigner to live in America will be to plunk down $500,000 for a piece of property.

Maybe we should rewrite Emma Lazarus’s words on the Statue of Liberty:

Give us your richest, fattest cats,

Your highest net-worth, seeking pleasure domes,

Your wealthy heirs and pampered brats.

Send these, with a half-million to buy our homes,

And gild our fading door mats.

hrhjuliet says

Democrat Senator Charles Schumer of New York

Really that is all you need to say to indicate that this bill is not worthy of consideration, as he is the epitome of political scum.

That aside the progressives are constantly taunting the virtues of no such thing as private property, why is this any different?

Yes, the progressives do believe this, and in reality it is the truth, but we live in a society that lives by a certain set of laws and values and that includes upholding the myth of owning property. We have a social structure and government built around it, and therefore we all uphold the established order in fear the other choice is chaos. We live under a very complex taxation and monitory system and to allow people to buy into citizenship is a recipe for further digressions into a plutocracy. We either respect we are citizens of the Republic and uphold the values of our constitution, or we allow the new power to continue to digress us into a plutocracy, which historically quickly becomes a totalitarian government. By the time the shift towards totalitarianism has begun it is usually too late for the average person to make any choices.

hrhjuliet says

and to allow people to buy into citizenship is a recipe for further digressions into a plutocracy

Folks, where have you ppl been during the past half century? Most Anglo-Saxon nations: Britain, USA, Canada, Australia, New Zealand have had various investment visa programs to attract the world's wealthy for ages. The same goes for Switzerland and bunch of others in the EU. And thus, this enables some rich folks to buy their way into the west. When I read this thread, it's as if this feed-the-rich was the discovery of Atlantis or aliens in Antarctica.

hrhjuliet says

Meanwhile, many states are doing whatever they can to make immigrants – mostly poor, but legal as well as illegal – feel unwelcome. For example, Alabama and Arizona allow police to demand “papers, please” from anyone they suspect may be undocumented (read: anyone who looks Hispanic). Alabama requires public schools to demand documentation from parents of all children in K-12 programs.

it should be noted they stop many "illegal border crosser" who are foreign citizens from Latin America, India, Africa, Europe, China and other Asian nations. Many times over they are part of criminal human smuggling operations.

So no its not ONLY Latinos who are stopped... this is a $3-4 BILLION a year Illegal crime operations tied to drug smugglers, prostitution and money laundry.

So, because it has been done in the past by other nations we are to assume its positive? It is not a great new discovery, it is a dialog, which happens from time to time. No worries, not much comes from a dialog, that is why I am interested in real action surrounding the issue. I am interested in seeing American citizens take action.

Why not pine to change the tax structure surrounding real estate. Here in fly over country, foriegn buyers scare me less than the boogey man. However, every layer of the tax code that incentivizes hoarding real estate helps to make us all poorer.

hrhjuliet says

we are to assume its positive?

In general, the problem is more when let's say the Russian mob sets up a series of cells, outside of preexisting Brooklyn NY, and thus, interferes with daily life in America. That's when letting in unscrupulous rich ppl become a major issue.

Aside from the nefarious crowd above, think about it, a rich person can live off his trading accounts and/or parent's industries from abroad. And thus, he's always a consumer and/or an investor (like angel investing in tech startups) for our stateside businesses.

In general, ordinary immigrant labor directly competes against regular Americans looking for jobs. I'd much rather see a person show up with millions, minding his own business, buying shares in my company, than in taking regular jobs away from other Americans. But sure, throughout US history, ppl have been coming here so I'm not against immigration per se but I don't see a major issue with letting in rich ppl who're not looking to compete against me but to perhaps ... invest in me.

"But what about American home buyers – many of them young, just entering the market – who would prefer low home prices that aren’t bid upward by rich foreigners? It’s not altogether obvious why we should favor American homeowners over American home buyers.

The visa-for-home swap proposal also comes at exactly the same time the nation is actively closing its doors to foreigners who aren’t wealthy. Is this what America is all about?"

hrhjuliet says

The visa-for-home swap proposal also comes at exactly the same time the nation is actively closing its doors to foreigners who aren’t wealthy. Is this what America is all about?"

Yes, because America is following the zeitgeist of the City of London. Think about it, why is the UK one of the world's top economies when its major products are cheddar (now, completely beaten by Wisconsin & Vermont), the Bentley, and Royal Family paraphernalia? Simple, it's the financial hub of the globe.

And then, closing the doors to working foreigners is appeasing the voters who're tired of offshoring and the abuses in the H1-B system.

Then, natives get the feeling that they're being protected while the wealthy get to diversify their holdings.

Like I said, we either respect we are citizens of the Republic and uphold the values of our constitution, or we allow the new power to continue to digress us into a plutocracy, which historically quickly becomes a totalitarian government. By the time the shift towards totalitarianism has begun it is usually too late for the average person to make any choices. I don't want to be like the British, I want our Republic restored.

hrhjuliet says

I don't want to be like the British, I want our Republic restored.

I think it's already too late. Many of the folks who grew up in London metro, commute 2 hours into the city, because a lot of London is unaffordable.

I too, live in central/western Mass, 1.5 hours from Boston because in my book, it's not worth paying $600K+, esp given the fact that many of us, have to periodically move, to keep our careers going, and I wouldn't want to risk that situation where 1) I couldn't sell my place or 2) sell it at a significant loss while looking for a new place elsewhere. Right now, my home is paid off and if I do some consulting gig, I can rent a studio apt nearby during those gigs.

hrhjuliet says

Yes, the progressives do believe this, and in reality it is the truth, but we live in a society that lives by a certain set of laws and values and that includes upholding the myth of owning property.

Yup but since the very definition of reality is agreement, you are really saying that as long as there is a country there will be private property.

hrhjuliet says

We live under a very complex taxation and monitory system and to allow people to buy into citizenship is a recipe for further digressions into a plutocracy.

Your question is your answer grasshopper, meaning that the "complexity" is the cause of the plutocracy. To think that it is anything more than cronyism is part of the problem.

hrhjuliet says

We either respect we are citizens of the Republic and uphold the values of our constitution

Truthfully it is too late and this ship is going to go down it will either be dystopian or Mad Max. I suppose there is a certain amount of sport in talking about turning the tyranny of the democracy but I'm afraid it is futile. I'm certain after listening to a reflection of the NY constituents in Schumer, Pelosi, Feinstein, Dodd, Franks, Reid or the Chicago putrid scum that this ship is GOING DOWN.

I honestly believe we can turn it around. Just an opinion, I know, but I believe in the power of the thinking minority and the intrinsic good in our being. We can overcome.

hrhjuliet says

but I believe in the power of the thinking minority

Talk about memes...

hrhjuliet says

the intrinsic good in our being

the myths override this.

Much of it stems from monetary policy which will change shortly however it will be too little too late.

thomaswong.1986 says

cloud15 says

I'm a legal immigrant .

Your a guest only. Not a US citizen which makes you foreign national. Remember that!

Thomas you are guest because I'm happy to put All Cash offer on your Los Gatos home and help you move to Dakota's .

I'm not a Guest and here to stay , just like your forefathers a few generations ago unless you are an Indian with a feather.

hrhjuliet says

I honestly believe we can turn it around.

I think you're in denial of the nature of western, sorry, make that former British settled nations.

The Jimmy Stewart version of the world is a Hollywood myth, extolling some small town virtues, as the bedrock of the Real Politic of the bigger central govt. What those small towns are, in reality, are either university centers or retirement communities. And thus, a close knit townie sort of system develops, and you get the friendly neighbors which you won't see in most Silicon Valley suburbs.

Think about it, Bangor Maine's industry is Stephen King novels. And does New Bedford MA, still have a whaling industry, a century plus, after 'Moby Dick'? I'd even speculate that if weren't for the four plus colleges & medical center, Burlington Vermont would be just as *rust belt* looking, as Plattsburgh, Albany, or Buffalo NY. The natural beauty of the famous Burlington view of Lake Champlain/Adirondack Mts is supported by the well off, from Boston & NYC, spending money up there for tourism and schooling. Everyone knows that there's little job growth there.

With the above as a backdrop, encouraging foreigners to invest their capital into the west, has already been a way for the US, UK, & company for ages. And then, that money circulates in the economy & can support the medical centers, tourism hubs, university towns, and basic services. A bunch of poor locals, can't infuse any resources into making themselves more prosperous.

Hence, Britain & Australia would love to give Stephen King, an investor retirement visa to stay permanently but want the rest of us, out after 90 days.

hrhjuliet says

But what about American home buyers – many of them young, just entering the market – who would prefer low home prices that aren’t bid upward by rich foreigners?

Just build more and the problem is solved.
The problem is not foreigners, it's the unwillingness to build new homes. Especially non-luxury homes.

Rin says

I think you're in denial of the nature of western, sorry, make that former British settled nations.

The Jimmy Stewart version of the world is a Hollywood myth, extolling some small town virtues, as the bedrock of the Real Politic of the bigger central govt. What those small towns are, in reality, are either university centers or retirement communities. And thus, a close knit townie sort of system develops, and you get the friendly neighbors which you won't see in most Silicon Valley suburbs.

I am not in denial, I am just not as cynical and a lot more hopeful. That doesn't make me ignorant, and it doesn't mean I am wrong. Some of the greatest advances in humanity were fueled by hopeful dreamers who worked for a better world for all. It does happen, maybe not as often, but it does happen. Since you brought it up, here is quote from one of those dumb ol' Jimmy Stewart movies for you all to scoff at, enjoy: "[After reading the Declaration of Independence] Now, youre not gonna have a country that can make these kind of rules work, if you havent got men that have learned to tell human rights from a punch in the nose. [The Senate applauds] Its a funny thing about men, you know. They all start life being boys. I wouldnt be a bit suprised if some of these Senators were boys once. And thats why it seemed like a pretty good idea for me to get boys out of crowded cities and stuffy basements for a couple of months out of the year. And build their bodies and minds for a man-sized job, because those boys are gonna be behind these desks some of these days. And it seemed like a pretty good idea, getting boys from all over the country, boys of all nationalities and ways of living. Getting them together. Let them find out what makes different people tick the way they do. Because I wouldnt give you two cents for all your fancy rules if, behind them, they didnt have a little bit of plain, ordinary, everyday kindness and a - a little lookin out for the other fella, too...Thats pretty important, all that. Its just the blood and bone and sinew of this democracy that some great men handed down to the human race, thats all. But of course, if youve got to build a dam where that boys camp ought to be, to get some graft to pay off some political army or something, well thats a different thing. Oh no! If you think Im going back there and tell those boys in my state and say: Look. Now fellas. Forget about it. Forget all this stuff Ive been tellin you about this land you live in is a lot of hooey. This isnt your country. It belongs to a lot of James Taylors. Oh no! Not me! And anybody here that thinks Im gonna do that, theyve got another thing comin. (He whistles loudly with his fingers in his mouth, startling Senators who are dozing or reading other materials) Thats all right. I just wanted to find out if you still had faces. Im sorry gentlemen. I-I know Im being disrespectful to this honorable body, I know that. I- A guy like me should never be allowed to get in here in the first place. I know that! And I hate to stand here and try your patience like this, but EITHER IM DEAD RIGHT OR IM CRAZY.". I know, I know, we are crazy in your opinion, my ignorant self already guessed that.

hrhjuliet says

Why not sell wealthy foreigners the right to live here, too?

Japan has a similar new visa program, too. Make it even explicit by adding visas for full-time household servants and parents you bring with you.

Yes hrhjuliet, I was right, you are Jimmy Stewart, since you quoted the entire rant from the 'Mr Smith Goes to Washington' movie.

Did you really buy the ending of that, with the fraudster fessing up, or the ending of 'It's a Wonderful Life', as anything other than fiction & fantasy? Think about it, Eric Snowden has found his freedom in Putin's Russia. How ironic is that one, a nation ruled by an ex-KGB dictator.

Rin says

Think about it, Eric Snowden has found his freedom in Putin's Russia. How ironic
is that one, a nation ruled by a KGB dictator.

I am sure they are watching his every move and I am sure that they have spelled out for him "conditions" and "consequences". I would not be surprised if one day his apartment were to suffer a carbon monoxide "accident"....

dublin hillz says

I would not be surprised if one day his apartment were to suffer a carbon monoxide "accident"

I think Julian Assange is ahead of Snowden on the depth chart. Along with the usual problems, wiki-leaks has also been posting sensitive info on the Russian Mafia's money laundering schematics. So thus, even if he's able to find permanent asylum in Ecuador, he may encounter an accident a lot quicker than Snowden.

Snowden is now most likely, a new found friend of the Russian underground. Think about about it as a reverse defection from the Cold War days... the spy who came into the Cold.

I take being anything like Jimmy Stewart in any Frank Capra movie as a compliment. Yes, l do believe in all that ignorant crap. Some parting words for you to roll your eyes at: "Now wait…now listen…now listen to me. I beg of you not to do this thing. If Potter gets hold of this Building and Loan, there’ll never be another decent house built in this town. He’s already got charge of the bank. He’s got the bus line. He got the department stores. And now he’s after us. Why? Well, it’s very simple. Because we’re cutting in on his business, that’s why. And because he wants to keep you living in his slums and paying the kind of rent he decides. Joe, you had one of those Potter houses, didn’t you? Well, have you forgotten? Have you forgotten what he charged you for that broken-down shack? Here, Ed. You know, you remember last year when things weren’t going so well, and you couldn’t make your payments? You didn’t lose your house, did you? Do you think Potter would have let you keep it? Can’t you understand what’s happening here? Don’t you see what’s happening? Potter isn’t selling. Potter’s buying! And why? Because we’re panicking and he’s not. That’s why. He’s picking up some bargains. Now, we can get through this thing all right. We’ve got to stick together, though. We’ve got to have faith in each other."

hrhjuliet says

indigenous says

Why?

I think this article sums it up better than I could: http://robertreich.org/post/11881926504

I feel this is a vastly underated issue and much more important than half the topics people are currently involved in.

This is one of the dumbest threads yet. No one with any real money is going to subject themselves to US taxes. People with real money are going to buy residences or citizenships in Andorra, Cayman Islands, Rarotonga etc., etc.. There are already US visa's for investment and they never come close to being used. There were something like 4000 e5's issued out of 10000 last year and that was a record year for the program. Less than a third go on to permanent residence.Holy cow batman, out of 9 billion people on the planet there are 1000 or so a year that actually have money and want to be in the US. That's certainly going to drive real estate through the roof. Get a grip.

bob2356 says

This is one of the dumbest threads yet. No one with any real money is going to subject themselves to US taxes. People with real money are going to buy residences or citizenships in Andorra, Cayman Islands, Rarotonga etc., etc.. There are already US visa's for investment and they never come close to being used. There were something like 4000 e5's issued out of 10000 last year and that was a record year for the program. Less than a third go on to permanent residence.Holy cow batman, out of 9 billion people on the planet there are 1000 or so a year that actually have money and want to be in the US. That's certainly going to drive real estate through the roof. Get a grip.

Taxes are low compared to Europe?

Living elsewhere is not as good an option as it might appear in your minds eye?

The premise of the OP is specious and not worthy of any effort as these things work themselves out through exchange. This is because the Chinese e.g. have created a huge imbalance through devaluing the Yuan. So the Chinese are forced to buy American assets because they sold goods for dollars, in other words there is a re balancing of debt from the trade deficit. This is changing because the US is projected to produce as much oil as Saudi Arabia by 2016, because car technology has lowered the need for oil, the trade deficit is projected to be 1/3 of what it is today.

I respect hrhjuliet's comments, but the issue seems a distraction. There is practically no limit to the amount of housing that we can build, so if foreign buyers want to balance our trade deficit by buying houses and apartments here, and paying property tax, that's fine. The real issue in "the zoned zone" is the restrictions on planning and zoning, which create artificial shortages and drive prices above where they should be. Then, having created that problem, local politicians use it as an opportunity for "affordable" (below market) housing programs that tax their enemies, drive prices even higher, and create a class of housing that can be allocated to favored recipients. SF unemployment is already below 6%, but if it ever got to critical mass, SF could achieve full employment by building more housing units and selling them to buyers from around the world. SF has currently somewhere around 300k units in a city of 800k that anchors a metropolitan area of 9 million. SF could build at least another 100k without running out of land, probably another 1 million if necessary, so I don't see why we would need legislation prohibiting foreign buyers.

indigenous says

The premise of the OP is specious and not worthy of any effort as these things work themselves out through exchange.

The premise of the OP is a confused muddle. He talks about limiting real estate purchases then links to an article about real estate purchases for residency. Which does he object to, investment purchases, residency purchases or both? Foreign real estate purchases have been around 10% of transactions for decades. Why worry about it now? I'd worry more about the other 90% of real estate being snapped up by the wall street 1% and being rented back to the 99%.

Even more confused is the part about a law to restrict foreign purchases based on scandinavian and french laws. There are no restrictions on foreigners buying real estate in those countries, so I can't figure out what he is babbling about. I want some of what Stanford professors smoke.

Yup there are shortages created by government, my favorite are the shortages created by rent control.

The politicians with their extensive list of now you are supposed tos only exist where there is a lot of money that can afford such absurdities.

bob2356 says

I'd worry more about the other 90% of real estate being snapped up by the wall street 1% and being rented back to the 99%.

Yup and the situation is created by low interest rate loans from the FED.

indigenous says

Yup there are shortages created by government, my favorite are the shortages created by rent control.

The politicians with their extensive list of now you are supposed tos only exist where there is a lot of money that can afford such absurdities.

I'm sure in the libratarian ideal world the people most dedicated to having no government restrictions would be the first to scream to their local politician if someone built a whorehouse or oil refinary across the street from their house. The fact is most people that complain about "government" have no problem at all using "government" to their advantage. They actually have a problem with other people getting something from "government".

indigenous says

bob2356 says

I'd worry more about the other 90% of real estate being snapped up by the wall street 1% and being rented back to the 99%.

Yup and the situation is created by low interest rate loans from the FED.

This is relevant to laws restricting foreign purchases somehow?

bob2356 says

I'm sure in the libratarian ideal world

Before Bob came to this forum he could not spell libertarian and now....

bob2356 says

people most dedicated to having no government restrictions would be the first to scream to their local politician if someone built a whorehouse or oil refinary across the street from their house.

That is not possible Sacramento will not tolerate competition, because of the aforementioned there will be a plethora of fracking and maybe even refining in the great state of...

bob2356 says

The fact is most people that complain about "government" have no problem at all using "government" to their advantage.

Au Contraire they are too busy running the government gauntlet of now you are suppose tos to think about it, in fact their mantra is don't ever think again that you will ever think again.

bob2356 says

They actually have a problem with other people getting something from "government".

Yes your understanding is truly profound, I might even give you the mutt award for 2014, for the moment.

bob2356 says

1000 or so a year that actually have money and want to be in the US

Yes, it's not a large number, however, what's important about it is that all 1K+ are financially independent. They are not a burden on the system & some of them, may even invest in local companies as a way to diversify their portfolio. Why would any Anglo nation not want that vs having to take in struggling working class types to compete against local labor?

Well for my part I'd like to see anti-discrimination legislation for renters with pets. Too many pets are killed because of a lack of pet friendly rental space, especially in single family housing. And before the haters get worked up at the potential damage, allergens, liability, noise and whatnot keep in mind landlords are ALREADY prevented from discriminating against families with kids:

http://www.nolo.com/legal-encyclopedia/free-books/renters-rights-book/chapter5-2.html

Kids are WAY worse than pets in these regards.

Most Asian landlords I encountered in my rental search had a no pet policy. Perhaps forcing such landlords to accept undesirable tenants may dissuade some of the fence sitters from getting into the rental game.