Perspectives on Real Estate Speaker Series
As the United States considers immigration reform, the latest speaker in a series hosted by the Atlanta Fed's Center for Real Estate Analytics explored the topic from a slightly different angle. That is, how does immigration affect housing demand?
Jacob Vigdor, a professor of public policy and economics at Duke University, shared findings from his research in collaboration with the Americas Society/Council of the Americas and Partnership for a New American Economy.
Vigdor's research has led him to conclude that immigration is an important contributor to the vitality of a community. The inflow of immigrants to a community spurs economic activity by boosting demand for local goods and services. This inflow also triggers a positive chain of events including even more new residents (both foreign- and native-born) and greater demand for housing.
It is through this virtuous cycle that immigration boosts home values. Vigdor estimates that for each new immigrant in a community, the average home price in that county increases 11.6 cents. That may not seem like much, but consider the fact that the average immigrant lives in a community with 800,000 housing units. And with more than 40 million immigrants currently in the U.S., those figures add up to a whopping $3.7 trillion in housing gains nationwide, he explained.
Communities in the Southeast have reaped a healthy share of those benefits. Indeed, four of the top 10 counties where immigration has had the largest effect on housing values are in the Southeast. These four counties are Gwinnett County in Georgia and Broward, Miami-Dade, and Palm Beach counties in Florida. In Broward County, immigration added $14,500 to the average home price. This interactive map, which Vigdor and his colleagues developed, shows changes in immigration and home values by county. For more information, view the presentation.