U.S. immigration is up, according to the U.S. Census Bureau. Currently, the United States has the highest proportion of immigrants since 1910,and 13.7 percent of homeowners in the U.S. are foreign born. Analyzing the Census Bureau data, LendingTree identified which cities hold the highest number of foreign-born homeowners.
In their study, LendingTree found that cities with higher proportions of foreign-born homeowners tend to have higher home prices. Prices for the top 10 cities average $491,750 compared with $167,560 for the bottom 10. However, the top city in the study, Miami, with 26 percent of homes owned by foreign-born residents, has moderate home prices, and a median home price of just $278,700.
"Out of the 50 largest cities in the country, those with a higher share of homes owned by foreign-born residents tend to have higher home prices," said Tendayi Kapfidze, Chief Economist at LendingTree. "This is not to say that immigrants raise home prices — rather, it's likely that immigrants gravitate towards these cities which have higher home prices, as they also have more dynamic economies and thus more employment opportunities."
Including Miami, many of the cities in the ranking are coastal cities. The top five are all coastal cities, with all but Miami located in California. San Jose and Los Angeles take the number two and three spot, respectively. San Jose has a foreign-born homeownership rate of 25 percent, while Los Angeles, has a foreign-born homeownership rate of 18 percent. These two cities have some of the highest home prices in the country: San Jose’s median home price is $957,700, while Los Angeles’s median home price is $617,100.
Kapfidze continued, "The proportion of highly-skilled immigrants is also higher in these cities which puts some upward pressure on home prices as a secondary effect. Thus, homeowners in cities with high foreign-born populations benefit from faster home price appreciation, creating opportunities for them to access this wealth via refinancing or home equity extraction. This added spending can in turn boost the economy or provide capital to fund new businesses."
Find the full report from LendingTree here.