This housing complex in Irvine California is being built for Chinese buyers,
separate walk-cooking rooms.
No one lucky fours in the addresses and
multiple entrances for multigenerational living.
>> Now, that video is actually from many years ago.
However, for decades now, foreign investors have been buying up the limited
housing supply we have here in the United States.
As you all know, we're dealing with a very serious housing crisis.
We absolutely need to build more housing.
And because of the lack of inventory in terms of single-family homes or
properties that ordinary Americans can buy,
it's actually leading to more demand in the rental market that is
driving up prices when it comes to rent, it has been a disaster.
And so now, we're hearing from some Republican lawmakers on a state and
local level, attempt to ban specifically Chinese nationals
from buying up real estate in their states.
Now, I'm gonna stop for a second and say I am against targeting one country,
which is what we're seeing from these Republican proposals.
But in general, I do think that we need regulations banning
investment from foreign nationals into United States real estate,
especially housing when we are dealing with the housing crisis.
If you don't live here, if you're not gonna live in the house,
you don't get to buy the house.
And by the way, this isn't some crazy right-wing idea, they've passed
similar laws in places like Canada where their housing market was being negatively
impacted by foreign nationals all over the world buying up single-family homes.
This is something that isn't even on Congress's radar and it's concerning me.
And since republicans have a more targeted approach against Chinese nationals for
obvious reasons, right?
They wanna fear monger about China and all of that.
Democrats are responding the way that they typically respond, This is racist,
this is hateful.
We're not having a conversation about it.
Okay, but we should have a conversation about whether it makes sense to allow for
foreign investment into United States real estate in the middle of a housing crisis.
In the middle of a situation where places like Los Angeles have 60,000 people living
on the streets.
We should have that conversation.
But Democrats are not having that conversation, that is an issue.
So, let's talk about what some of these other states are doing and
what Republicans are proposing.
At least 11 states are considering some form of new legislation
related to foreign ownership of farmland or real estate,
according to the National Conference of State Legislators.
Now, lawmakers have expressed concern over the security of the nation's food
supply and worry that several land purchases were deliberately made near
American military bases.
I'm gonna say, I'm just gonna admit that is a little bit concerning, right?
So, we do unfortunately have an increasingly adversarial relationship with
China.
I probably would feel uncomfortable with allowing for
Chinese national to buy farmland right next to a military base.
Now, the United States Air Force weighed in on a Chinese company's purchase of
a corn mill in North Dakota, not far from a base declaring it a significant threat.
So again, the motivations for
Republicans are very different from what my motivations are.
My motivation is, we need to protect the limited housing supply we have for
Americans and not allow foreign nationals who don't live here,
don't wanna live in those houses to park their money in our real estate.
And by the way, oftentimes when that money is used to buy US real estate,
it's also meant to launder the money that they've made, right?
So, that's also a problem.
But anyway, for
Republicans, they're concerned about national security allegedly.
Okay, now a Chinese company also bought land near an Air force in Del Rio Texas.
And so, that's part of the reason why Texas Governor Greg Abbott,
with the help of Republican lawmakers in his state are pursuing legislation to
ban Chinese nationals from purchasing real estate in their state.
Now, there are again some issues with how the proposals are written, right?
So, some of the new and proposed laws go beyond targeting Chinese nationals to
broadly take aim at ownership by all foreign governments businesses.
And here's where I have an issue, new immigrants.
So, if you're a new immigrant,
you're here in the United States like you're gonna live here.
I don't think you should be included in this conversation.
My issue is with people buying up our limited housing supply just as
an investment or as a way to launder their money because that hurts
us US citizens who desperately need the housing.
Other laws, like the one under consideration in Texas,
do in fact single out countries seen as particular security threats,
including Russia, Iran, and North Korea, in addition to china.
Are North Koreans buying up US real estate?
I like how they gratuitously included North Korea.
I don't know, maybe they are.
I'm just completely unaware of it.
In Texas, Democratic leaders though said that the broad measure now before
the legislature appear to be prompted more by a rising anti-China political
environment than any legitimate concern over espionage or
foreign ownership of the food supply.
Well, look into it and research it and see if there's actually a threat because I
think it would be a bad idea to just automatically dismiss what Republicans
are worried about because you don't like republicans, right?
So, if there's evidence to prove that these are unfounded concerns,
then by all means reject what Republican lawmakers are trying to
do in the state of Texas or any other state where they have similar proposals.
But they should do their due diligence and at least hear them out on that.
Now, there are some other concerns, right?
Such a bill would raise a host of constitutional issues because the measure
does not distinguish between targeting people who are already here and
those outside the United States.
It raises serious due process and equal protection issues.
And that's according to a law professor over at the University of Texas.
And I think that is a legitimate critique.
And so, in response to an inquiry from the New York Times about that,
one Texas state senator said, good point we're gonna do better and
make sure that we're more specific in how we write this legislation to ensure
that there are no constitutional violations by the proposed legislation.
Now, in California, a bill to rein in foreign ownership
of farmland passed both Democratically controlled houses last year.
The bill sponsor, Senator Melissa Hurtado, a Democrat said it was an effort to
stop the purchases while trying to better understand the motivation behind them.
But notice how it focuses on farmland,
it does not focus on what I think it should focus on which is housing.
Now, the California bill by the way did make it through the state legislature,
but it was then vetoed by Gavin Newsom, curious.
And I should note that Chinese investors are among the top foreign purchasers
of residential real estate along with Canadians.
And that's according to the National Association of Realtors.
I think in Oklahoma, they might have a better plan in place.
In Oklahoma, the Oklahoma constitution limits land ownership to US citizens.
Those laws, unlike the proposal in Texas,
do not single out citizens of particular countries.
In Canada, a sweeping ban on foreign ownership of residential property went
into effect this year, which sounds pretty good a move that the country's
liberal leadership said was aimed at curbing soaring housing prices.
Canada gets it, that is what I would like to see implemented here.
Again, if you live in a different country and you have no intention of actually
living here or living in the house that you have purchased,
you don't get to purchase the house.
Sorry, we need housing.
Now, foreign buyers purchased $59 billion worth of US
existing homes from April of 2021 through March of 2022
an 8.5 increase from the previous 12-month period.
China and Canada remain first and second in US residential sales
dollar volume at 6.1 billion and $5.5 billion respectively.
Continuing a trend going back to 2013.
India, Mexico, and Brazil also rounded out the top five.
So, it's not just China, it's not just Canada,
there are other countries involved.
I'm not trying to single out any particular country again, for me,
it's about making sure that we save our housing for people who actually
need that housing because they need to live in it, they need shelter.
Finally, couple that with the other issue that we're seeing in the housing market
and it's a growing issue.
It's the institutional investors, the private equity firms that have now
started snatching up single-family homes in various big cities across the country.
Now, they'll argue now it's just, I mean, if you look at the percentage
of home sales that go to institutional investors a small amount.
But if you take a look at places like Atlanta right, it's really concentrated
in certain parts of the country, they consist of most of the home sales.
So, why don't we take a look at this next video to see what kind of impact
the investment in real estate is already having.
>> In January 33% of all homes purchased in the US were bought by investors.
Often Wall Street-backed companies with multi-billion dollar funds.
The colliers currently renting a town near Fisher's from one of the nation's biggest
house rental companies.
Their rent recently raised 8%.
Four times in recent weeks they've been outbid by investors with all-cash offers.
>> That can be discouraging when you get home overbid by companies.
>> How do you save when you're spending 2200 a month just to rent?
>> So, these companies have you on both ends?
>> Yeah, it's definitely [LAUGH] a conundrum.
>> In some Fisher's neighborhoods, investors own more than half of the homes,
according to realtor Laura Turner.
>> This is one of the neighborhoods that investors have really targeted, they're
coming in, they're buying it at cash and then they're gonna hold them as rentals.
>> They're gonna hold them as rentals because their next big business move is to
become corporate landlords.
And with the limited supply of housing for you to be able to purchase,
obviously, the cost of that becomes more and more unaffordable astronomical.
So, you have no choice but to rent.
And when institutional investors and private equity firms are the ones
who hold the majority of rentals, you're really at their mercy.
That needs to be banned too.
So, we have two major issues, foreign investment in US real estate,
institutional investment in US real estate.
No conversation in Congress about curbing that whatsoever.
And the people who suffer the consequences for that are people like you and me.
Yes, we need to build more housing, no question about that.
But we also need to deal with some of the lack of regulation that would allow for
institutional investors to swoop right in and purchase that new housing
because they've got a leg up, they have the resources to do it.
You can't compete with an institutional investor that can make an all-cash offer.
So, if we build the new housing, but
we don't deal with the regulations necessary to curb that behavior.
Who's to say that they're not gonna purchase all the new housing that's built
or the majority of new housing that's built?
Lot of issues at play here.
Lot of things to think about.
I know that there's just this ideology of, no just build more housing, just do it,
just do it.
No, no, yes, we do need to do that.
But there are other issues that we have to make sure that we deal with
to make sure that the people who get to take advantage of that new housing
are ordinary Americans who need it, not institutional investors and
not foreign nationals looking to launder their money.