Foreigners may get an added bonus when they invest in residential real estate in the U.S. Ã¢â‚¬" a visa.
Sens. Charles Schumer (D-New York) and Mike Lee (R-Utah) are proposing a bill that would offer residence visas to foreigners when they spend at least $500,000 in the U.S. residential real estate market, according to the _Wall Street Journal._
Investors may split their spending between two or more properties, as long as they spend at least $250,000 on one home and $500,000 or more total, according to the _Journal._
The visa granted would be a residence visa and not a work visa, according to CNBC, and when the investor sells the
property, his or her visa is no longer valid. These investors may apply for work visas through the traditional process.
In addition, one of the major stipulations of the deal is that the investor, while not granted a work visa, would have to live in their U.S. home for at least six months of the year, according to CNBC.
While these stipulations might be limiting, the hope is that the bill will entice foreign investors to absorb some of the excess inventory currently on the market, especially in hard-hit areas such as Florida, California, and Arizona.
Between March 2010 and March 2011, foreign buyers purchased $41 billion in U.S. real estate, according to the National Association of Realtors (NAR).
During that period, 58 percent of all international transactions took place in Arizona, California, Florida, and Texas, with 43 percent in Florida and California - two particularly hard-hit areas.
An August report by Capital Economics notes that the low prices resulting from high percentages of foreclosures in these states may be enticing foreign buyers.
Capital Economics predicted in its report that foreign investing in the U.S. housing market will increase over the next several years, but Sens. Schumer and Lee hope to enhance this trend.