Can foreigners be lured by favorable VISA treatment into creating new jobs and bolstering home prices in the U.S.?
Yesterday’s Boston Globe had an interesting article about a program designed to increase business investment in the United States.
The immigrant investor program, created in 1990 by Congress to compete with a similar initiative in Canada, helps foreigners slash through the red tape in the US immigration system while allowing businesses … to raise the money they need to expand.
Specifically, foreigners would be required to invest $1 million in a “job-creating” business venture (or $500k in certain rural or distressed areas). In return, they would receive a “green card” allowing them to work in the United States. This is a win-win. It results in more investment and it attracts wealthy people—who typically are highly-skilled laborers—to the United States.
Recently, Senators Chuck Schumer (D-NY) and Mike Lee (R-UT) proposed a similar but narrower program for residential investment. From the WSJ:
The reeling housing market has come to this: To shore it up, two Senators are preparing to introduce a bipartisan bill Thursday that would give residence visas to foreigners who spend at least $500,000 to buy houses in the U.S.
In this particular recession, the decline in home values is playing a huge part in sluggish consumer spending. So increasing residential investment should help give the economy a much-needed boost. But, in this bill, the devil is in the details. Purchasers of homes would NOT get a green card.
Foreigners immigrating to the U.S. with the new visa wouldn’t be able to work here unless they obtained a regular work visa through the normal process. They’d be allowed to bring a spouse and any children under the age of 18 but they wouldn’t be able to stay in the country legally on the new visa once they sold their properties.
This, then, is a modest benefit that would be helpful only to a select few: retirees and purchasers of vacation homes.
To give a significant boost to the U.S. home market, this plan should be modeled on the business investment program. People who invest $500,000 in residential real estate should be able to work in the United States to attract both capital and skilled labor. Schumer and Lee’s bill is a start, but it should not be so timid.