Bostadsmarknader är föredragna destinationer för utländska investerare som letar efter avkastning, fritidshus eller säkra tillflyktsorter, eller för dem som undviker skattebegränsningar och korruptionsåtgärder i sina hemländer. Men efterfrågan på amerikanska hem från utländska investerare, speciellt kinesiska, pressar upp bostadspriserna, förvärrar oron över överkomliga bostäder, enligt ny forskning från Wharton.

Huspriserna ökade med 8 procentenheter mer i USA:s postnummer med många utlandsfödda kinesiska befolkningar från 2012 till 2018, enligt en tidning med titeln "Global Capital and Local Assets:House Prices, Mängder, och elasticiteter, " författad av Wharton doktorand Caitlin Gorback och Wharton fastighetsprofessor Benjamin Keys.

"Den stora bilden är att vi har en överkomlighetskris för bostäder i städerna där jobben finns, ", sa Keys. "En av de verkliga spänningarna på den amerikanska bostadsmarknaden är att de platser som ser kraftig jobbtillväxt inte skapar nya bostäder tillräckligt snabbt för att ta emot den jobbtillväxten."

Det skarpaste exemplet på kopplingar mellan jobbtillväxt och bostäder är San Francisco Bay Area och specifikt San Mateo County, sa Keys. Sedan 2012, den regionen har haft cirka 30 % ökning av sysselsättningen, men mindre än 10 % ökning av bostäder, han lade till.

Keys skyllde bostadsbristen på zonindelningsbegränsningar som avskräcker från att bygga nya bostäder, och stigande byggkostnader. "Det finns ungefär sex gånger så många nya jobb som det finns nya bostadstillstånd, " sa han. "Det finns många ringar att hoppa igenom för att få något byggt på dessa platser, speciellt att bygga på ett sätt som är tätt."

Utlänningar som köper bostäder i USA förvärrar potentiellt problemet med överkomliga priser, Nycklar fortsatte. Kinesiska köpare har lett utländska investeringar i amerikanska hem under de senaste sju åren. Under 2019-2020, de köpte amerikanska bostadsfastigheter värda 11,5 miljarder dollar, eller lite mer än en sjättedel av det totala, enligt en rapport från Riksförbundet för fastighetsmäklare (NAR). Andra investerare i topp fem kom från Kanada, Mexiko, Indien och Colombia, i den ordningen. (Colombia ersatte förra året Storbritannien som det femte största ursprungslandet för utländska köpare). Utländska köpare utgjorde 4 % av försäljningen av befintliga bostäder på 1,7 biljoner dollar förra året, noterade NAR-rapporten.

Gorback och Keys forskning visar också att huspriser och hyror har stigit på platser som har sett stora doser av utländska investeringar. "Det beror till stor del på att de platser där du ser utländska köpare är samma platser som har mer dynamiska ekonomier och har fler jobb."

Ungefär hälften av de bostäder som utlänningar köper används som primära bostäder; de andra fungerar som fritidshus, fritidshus eller en pied-a-terre som de besöker ibland, sa Keys. "Till exempel, En stor del av de kanadensiska investeringarna i amerikanska hem kommer från snöfåglar som köper hus i Florida."

Räckvidden av en "efterfrågechock"

Att använda utländska investeringar som en "efterfrågechock, " Tidningen tittar också på hur lyhörd bostadsutveckling är för förändringar i pris. "Om priserna stiger på en marknad, sporrar det konstruktionen? Leder det till spadar i marken?" frågade Keys. Olika marknader reagerar olika på dessa triggers, och mycket beror på tillgången på alternativa platser i närheten, noterade han.

Studien fann att bostadsmarknaderna är relativt oelastiska mot prisförändringar på kort sikt på cirka 10 år. "Bostadspriserna kan röra sig mycket snabbare än vad bostadsbyggandet kan, " sa Keys. Han tillade att "kustmarknader och marknader som har haft historiskt strängare zonindelningskrav verkar vara mer oelastiska under denna period, " och tillägger att detta fynd stämmer överens med tidigare forskning.

Keys noterade att deras forskning ger "en ny empirisk uppskattning av dessa elasticiteter som inte har uppskattats med detta tillvägagångssätt eller under denna tidsperiod." Det gör det möjligt "att jämföra och kontrastera och förhoppningsvis kalibrera urbana ekonomimodeller relaterade till hur lyhörda vi skulle förvänta oss att bostadsmarknaderna skulle vara för olika typer av chocker, " han lade till.

"Efterfrågechocken" av utländska investeringar utlöser också ringeffekter på bostadsmarknaderna, studien fann, citerar Seattle som ett exempel. "När det gäller Seattle, när du borrar ner geografiskt, du ser detta mönster av differentierad bostadspristillväxt, inte bara i de höga utlandsfödda kvarteren, men i kvarteren som gränsar till dessa kvarter, sa Keys.

The Seattle example is part of the study's computation of the impact foreign capital flows have on house prices and supply for the largest 100 markets in the U.S. It found that local housing markets are price inelastic in the short run, but that is heterogeneous (or varies) across markets. Seattle displayed "a spillover effect" where investment in foreign-born Chinese neighborhoods pushes up housing prices in the nearby neighborhoods as well, Keys continued. Seattle also absorbs some of the demand redirected from Canada, where cities like Vancouver deter foreign ownership of homes through taxes, including on ownership of vacant homes, han lade till.

Redirected Foreign Demand, Volatility

The U.S. housing market is also particularly sensitive to tax restraints many countries impose on foreigners buying residential properties in their jurisdictions, the paper found. Some of the investors turned away from those countries head to the U.S., which does not have those tax restraints.

Chinese investments in U.S. housing reflect in part a flight of capital from China in recent years, said Keys. "A big part of that was about wealthier Chinese citizens moving their money abroad to avoid taxes and to avoid scrutiny, " he added. In fact, China in 2016 experienced "the greatest episode of capital flight in history, " according to a Wall Street Journal report at the time.

As those investors turned their attention to the U.S., its housing markets turned out to be more sensitive than previously thought, said Keys. "One surprising finding in our study is how responsive foreign investment is to tax policies imposed abroad, " he added. "The takeaway for us is that these policies that are being imposed in countries like Singapore, Australien, Canada and New Zealand have a direct effect on the U.S. housing market."

Several countries consciously regulate foreign investments in residential properties, recognizing the undesirable effects some of that could have, especially with speculation. The paper documents 10 policy events in five countries between 2011 and 2018 that made the U.S. housing market "relatively cheaper to invest in." The governments in those countries used tax policy to deter foreigners from buying housing properties and to curb speculation.

Singapore was the first to introduce a foreign buyer tax in 2011 in the form of a stamp duty; it progressively increased that to 20% by July 2018. Hong Kong levies stamp duties of 30% on nonresident home buyers, which includes a duty on those who are not first-time buyers, including residents.

Others that levy taxes on foreign buyers of residential properties include the governments of British Columbia and Ontario in Canada; Victoria in Australia; and New Zealand. British Columbia also levied a speculation and vacancy tax in certain communities. Many countries impose such "foreign real estate buyer taxes" in order to deter foreign capital inflows and stabilize housing prices in their markets, the paper's authors noted.

While foreign investments have lifted home prices in select U.S. markets, they have declined in the last three years. Foreign inflows had been steadily increasing from $66 billion in 2009-2010 to $153 billion in 2016-2017, but have since dropped to $74 billion last year (2019-2020), according to the NAR report cited earlier.

Chinese investments in U.S. housing have followed that pattern, falling from nearly $32 billion in 2016-2017 to $11.5 billion last year. Keys attributed that to China's capital controls in recent years and pressure on its citizens to unwind their investments abroad in order to shore up its domestic economy, as the Wall Street Journal reported. The U.S.-China trade war, U.S. controls on immigration and unfavorable exchange rates have also dampened Chinese investments in U.S. housing, noterade han.

What's Next for U.S. Housing?

Keys said his study is timely now because "there's a big question about how the housing market will come back after COVID-19." He noted that several housing submarkets in the U.S. have seen "huge inflows of foreign investment" over the last 10 years. "If that dries up, it would represent an opportunity for domestic buyers and put downward pressure on prices, but that may be a bad thing for existing home owners."

If the pandemic persists, foreign investments in U.S. homes would continue their decline, and cause home prices to fall, Keys predicted. In that setting, "clearly, there would be an advantage for domestic homebuyers, " said Keys. "[Also], a decline in foreign investment may relax some of the affordability constraints to a modest degree in cities where the jobs are more plentiful than the housing in them."

Some of the space vacated by Chinese and Canadian investors could be filled by those from Mexico, India and Colombia, which have shown rising appetites for U.S. homes. But such demand is "highly dependent" on U.S. federal policies, said Keys. U.S. policies on combating COVID-19 is the first factor, han lade till. "Relative to the alternative markets where foreign buyers may be considering, we as a country have done the worst job managing the COVID crisis. Investors who are deliberating between the other megacities of the world and are concerned about public health will steer their investments away from the U.S. at the moment."

The outcome of the forthcoming U.S. presidential election could change some of those stakes. "Just nu, it feels like a difficult time for immigrants to feel welcome in this country, given the set of federal policies in place and the barriers to immigrate, " said Keys. "So, a change in administration that is attached to a change in those policies could certainly reinvigorate investment in the U.S. housing market."

Policy Prescriptions

Could the U.S. do something to protect its housing markets from unfavorable foreign investment? Policy makers could weigh the speed and magnitude at which foreign capital flows would decline, if the U.S. were to impose "a large foreign buyer tax" to deter foreign investments in housing, said Keys. Such investments "appear to be quite elastic" to the imposition of a foreign-buyer tax, han lade till.

"My concern is largely one of unused housing units, especially in expensive areas, " said Keys. A vacancy tax similar to that in Vancouver is "worth considering, " he added. "One of the things that rapid flows of investment could do is they can distort construction efforts and put additional resources towards building properties that foreign investors may want only in the short term, but then that housing stock will last a very long time."

Keys also urged state and local governments to re-examine zoning and height restrictions, and the time delays that permitting for new construction entails. "The number of hurdles to jump through makes it so challenging to develop affordable housing in the U.S., " he added. Some states like California have already begun taking legislative action to push local communities to change their zoning rules, noterade han.