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Published Report

Title: Immigrant Contributions to Housing Demand in the United States: A Comparison of Recent Decades and Projections to 2020 for the States and NationOpen File
Date: 3/6/2013
Author(s): Professor Dowell Myers and John Pitkin

Executive Summary:

Immigrants are an important and growing source of demand that has bolstered housing markets in recent decades. As recently as 1990, immigrants were heavily concentrated in a few gateway states, such as California, New York and Florida. More recently, growing numbers of immigrants have located in new destinations throughout the nation. In the aftermath of the 2007 collapse and subsequent stagnation of housing markets in most states, there is a need for better understanding of immigrants’ potential contribution to a recovery of demand for housing and homeownership in the years ahead.

This study constructs a demographic-based projection through 2020 of the growth in homeowner and renter households headed by immigrants in the states and regions of the nation. The research is subject to challenging data constraints, which include the lack of 10-year housing market projections and even population projections for states. Our method for projecting occupancy demand in this study is to build on prior projections of population and housing occupancy for the nation. We then take advantage of existing data measuring each state’s share of national totals in specific demographic groups. When the state shares are applied to national projections of population and households we arrive at projections of the numbers of owner occupied and total occupied housing units in each state. In this way, we project potential housing demand through 2020 for large states and regional groupings. We compare these projections to the past trends in each area.

A total of 24 states and sub-regions of the United States are projected in the study. In this report we summarize the geographic distribution and national pattern of growth in housing demand. Substantial details for the states and sub-regions are reported in Appendix B. Growth in housing demand in recent decades has been more stable among foreign-born than native-born households. This is because increases in native-born demand have been subject to large swings in the size of cohorts reaching ages 25 to 34, the modal age of entry to the housing market. In contrast, inflows of new immigrants have not varied widely in recent decades, and in addition the strong upward mobility of prior immigrants has led to continued increases in aggregate demand for home ownership.