Fox News contributor Laura Ingraham used a single anecdote about supposed undocumented immigrants living together in close quarters to denounce a study finding that immigration reform would help the housing market. In fact, the study finds that the immigration population -- including undocumented immigrants -- would benefit the housing market by driving up values, as well as generating demand in previously less desirable neighborhoods.
In Speech, President Barack Obama Said Immigration Reform Would Help The Housing Market
President Obama: According To Recent Study, Immigration Reform Would Cause Home Values To Increase. In an economic speech discussing the housing market on August 6, President Obama cited a recent study by the Americas Society/Council of the Americas and Partnership for a New American Economy saying, "the average homeowner has already seen the value of their home boosted by thousands of dollars just because of immigration." [Remarks by the President on Responsible Homeownership, 8/6/13; Americas Society/Council of the Americas, 8/6/13]
Laura Ingraham Uses Unverified Personal Anecdote To Attack President's Statements As False
Ingraham: "I Can't Imagine" That Undocumented Immigrants Increase Property Value Because "They All Live In One Place." During the August 8 edition of The Laura Ingraham Show, Ingraham suggested the study cited by the president must be incorrect, recounting an anecdote she heard from friends who claim to be living in a condo building that has 10 people living in one unit. Based on this one piece of evidence, Ingraham claimed that she "can't imagine" how people living in one place is "good for the homeownership and the home value":
PRESIDENT OBAMA: Fixing our broken immigration system is something that you don't always hear about when it comes to the housing market. It's pretty simple, when more people buy homes, and play by the rules, home values go up for everybody. And according to one recent study, the average homeowner has already seen the value of their home boosted by thousands of dollars just because of immigration.
INGRAHAM: What type of immigration are we talking about? So I'm looking -- I'm interested in the analysis of this, the actual research that backs up what he just said. Because I have friends who live out in Silver Spring, Maryland, who have told me that, in their-- they have this condo building that they live in, third floor. And it turns out that on the first floor, I guess one or two of the units, that was rented out, is rented to people who, I don't know if they are illegal or not, but there are like ten people in one unit, with two small bedrooms and like a study. Now they're obviously not supposed to be doing that and I can't imagine that the more you have that, which often times happens with day laborers, they all get in, everyone's seen it, they all live in one place, that that's good for the homeownership and the home value of the people who own those other units. [The Laura Ingraham Show, 8/8/13, emphasis added]
But The Study Cited By President Obama Takes Into Account Undocumented Immigrants, Still Finds Benefits
AS/COA Study: "The 40 Million Immigrants In The United States Have Created $3.7 Trillion In Housing Wealth." A study published by the Americas Society/Council of the Americas and Partnership for a New American Economy found that immigration has already helped the housing market by driving housing demand through their purchasing power, indirectly generating demand of U.S.-born individuals, and shifting demand "within metro areas towards neighborhoods that had fallen out of favor" :
New research by Americas Society/Council of the Americas (AS/COA) and Partnership for a New American Economy (PNAE) finds that the 40 million immigrants in the United States have created $3.7 trillion in housing wealth, helping stabilize less desirable communities where home prices are declining or would otherwise have declined.
Immigrant workers strengthen the housing market in three ways:
- They directly drive housing demand through their own purchasing power.The 40 million immigrants in the United States represent a powerful purchasing class--reflected by their demand for housing, as well as for other locally produced goods and services--that bolster the value of homes in communities across the country.
- They indirectly generate demand by drawing U.S.-born individuals to opportunities in growing areas.The research shows that for every 1,000 immigrants settling in a county, 250 U.S.-born individuals follow, drawn by increased economic opportunity.
- They shift demand for housing within metro areas toward neighborhoods that had fallen out of favor.The research finds that immigrants often contribute to the stabilization of less desirable neighborhoods, helping those areas become viable alternatives for middle- and working-class Americans. This opens up new opportunities for those without homes to consider purchases in areas once in decline--an important trend in expensive metro areas. [Americas Society/Council of the Americas, 6/20/13, emphasis original]
The U.S. Immigrant Population Of 40 Million Includes 11 Million Undocumented Immigrants
Pew Research Hispanic Center: The Nation's Total Immigrant Population Reached 40.4 Million, Including 11.1 Undocumented Immigrants, In 2011. According to a study by the Pew Research Hispanic Center, an analysis of Census Bureau data found that in 2011, the immigrant population in the United States was 40.4 million. Of that 40.4 million, 11.1 million were undocumented immigrants. [Pew Research Hispanic Center, 1/29/13]
Previous Research Confirms AS/COA Study's Findings
UPenn Study: Immigration Inflow Of "1% Of A City's Population Is Associated With Increases In Average Rents and Housing Values Of About 1%." A 2006 study conducted by Albert Saiz of the University of Pennsylvania found that immigration "pushes up the demand for housing" which temporarily increases rents, but does eventually benefit homeowners from higher housing prices:
Immigration pushes up the demand for housing in the destination areas. Rents increase in the short run, and housing prices catch up.
An immigration inflow that amounts to 1% of the initial metropolitan area population is associated with, roughly, a 1% increase in rents and housing values. It is useful to benchmark these results to the results in the wage literature. The population-weighted average share of the foreign-born in the US (metropolitan areas in the 2000 census) was 12%. To increase this share by 1%, the average city would need an immigration inflow equal to 1.15% of the initial population. Using the modal estimate in the paper this could increase rents by 1.15%. Arguably, from the labor literature, a 1% increase in the relative share of a skill group depresses the relative wages of that group by 0.03%. The typical renter-occupied household spends about ¼ of their income in rental payments. Thus, ceteris paribus, the change in rents amounts to 0.28% of initial income, which is an order of magnitude bigger than the relative labor market effect for renters. Homeowners, on average, do benefit from higher housing prices, pointing out to a small distributive impact in the short and medium run. [University of Pennsylvania, June 2006]