In San Francisco, an Indian software engineer on a work permit canceled plans to bid on a $900,000 home. In Washington, a Brazilian nonprofit executive passed on a fixer-upper near her office. And, in Mesa, Arizona, a 24-year-old son of undocumented Mexican immigrants won the trust of a bank -- a green light for a mortgage -- but now fears deportation.
President Donald Trump’s immigration policies threaten to crack a foundation of the American economy: the residential real estate market. Legal and otherwise, immigrants, long a pillar of growth in homebuying, are no longer feeling the warm welcome and optimism necessary for their biggest purchase.
“I feel like with one stroke of Trump’s signature everything can be taken away, even all my hard work,” said Juan Rodriguez, the 24-year-old whose parents moved from Mexico when he was 7. He now works full time while earning his college degree.
President Barack Obama had protected immigrants like Rodriquez, often called “dreamers,” or undocumented Americans who arrived as young children and are often fully integrated into American society.
On Tuesday, the Trump administration detailed plans for a sweeping crackdown on undocumented immigrants, saying the authorities would deport many more people without court hearings. Under Obama, the government focused on those convicted of violent crimes; Trump would lower the bar to include fraud and, in some cases, a belief the residents threatened public safety.
Even workers with green cards and work visas under the H1-B program for skilled foreign workers are worried about possible restrictions under Trump. The housing markets most at risk include Miami, Silicon Valley, Los Angeles, San Francisco and New York, which have the biggest concentrations of foreign-born buyers.
While the Trump administration indicated it would exempt dreamers, stepped-up immigration raids and the travel ban on seven majority-Muslim countries -- blocked in court -- are creating panic in many who believed that their American dream was within sight.
“If Trump gets the immigration plan he wants, the housing market will get hit harder than any other,” said Alex Nowrasteh, a policy analyst for the libertarian Cato Institute. If “millions of people get deported and more people don’t come in to take their place, then you’ll have downward pressure on home prices, especially in urban areas.”
The immigrant housing market is often underappreciated, in part, because undocumented workers and the companies that cater to them sometimes like to fly below the radar.
Some smaller firms will make loans to the undocumented, with higher interest rates. A few larger lenders such as Winston-Salem, North Carolina-based BB&T Corp. market to dreamers, who can qualify for conventional Fannie Mae, Freddie Mac and Federal Housing Administration mortgages.
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