Briefly: investor visas and the housing crisis

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For the last few years I’ve been keeping an eye on the news about investor visa programs like the US EB-5 program. These programs typically give wealthy foreigners permanent residency in exchange for a large investment in business or real estate. They’re often controversial because they give a path to citizenship (something sacred) in exchange for cash (something profane). It’s also unclear whether these programs actually produce any economic benefits for the countries and regions that receive the investment.

Stories about unintended effects of foreign investment on the real estate market have been popping up in the last few weeks. (Not all foreign investors are doing it in order to get permanent residency, but one can assume that a good number of them are.) In Vancouver, groups of unrelated families are moving into large mansions owned by offshore investors. As foreign investment and other factors are making housing increasingly unaffordable in the city, sharing a large house that would otherwise have sat empty has emerged as an alternative housing strategy.

While the article suggests that most of the group housing mansions in Vancouver are older buildings, overseas investors here in the Los Angeles region are building brand new ones.  Wealthy Mainland Chinese are buying lots in the San Gabriel Valley suburb of Arcadia, razing the ranch-style homes on top of them, and building mansions. As in Vancouver, many of these new mansions sit empty. Will groups of yuppie families, priced out of LA real estate, be moving into these buildings, too?

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Quarterly update, hippo edition

Photo: RayMorris1. Flickr/Creative Commons.
Photo: RayMorris1. Flickr/Creative Commons.

Language Wars
An op-ed I wrote about China, Taiwan, and the politics of Chinese language learning has been published on Hippo Reads, a new media site that brings academic insights to a broader audience. If you’re interested in submitting, they have more information on their website.

Mellon Mays
Since my return from Oslo I’ve resumed my post as the lead graduate mentor for the Mellon  Mays Undergraduate Fellowship Program at UCLA. This is my eighth quarter working with the program.

Last summer, I developed the syllabus for the academic professionalization course that is at the core of the program. Now, I get to teach the workshops that I designed. The juniors are learning about the structure of academic careers, while the seniors are working on elevator pitches about their thesis projects. Next quarter, we’re preparing both cohorts to present their research at UCLA’s Undergraduate Research Week.

Public radio appearance
I was interviewed for a story about the intergenerational transmission and maintenance of lunar new year traditions on KPCC. In less academic terms, that means that I was on the radio talking about red underwear.

Residency for sale

Photo: ebolavir.
Photo: ebolavir.

The investor visa has been a popular way for Western countries to attract foreign capital. In exchange for a substantial chunk of change, individual investors can obtain permanent residency and a path to citizenship for themselves and their family members. North American, Australian, or European permanent residency can be highly valuable for wealthy citizens of developing countries. For example, Chinese passport holders with US permanent residency enjoy the privilege of visa free entry to a number of countries that otherwise require visas for Chinese citizens. US permanent residents and citizens also have preference in admission to many US universities.

The amount of capital required to “buy” permanent residency in the West is generally quite high. Under the US EB-5 visa scheme, a foreign investor may get permanent residency in exchange for a $1 million investment, or a $500,000 investment in a rural or high-unemployment area. This is significantly more generous than equivalent schemes in other English-speaking countries of immigration. New Zealand requires a NZD 1.5 million (USD 1.28 million) minimum investment, while the United Kingdom wants GBP 1 million (USD 1.68 million) and Australia a whopping AUD 5 million (USD 4.62 million). None of these schemes grant permanent residency automatically.

I became aware of Portugal’s unique investor visa scheme through my Tumblr, migrantography. User ebolavir posted a photo of a storefront in Lisbon with signage in Chinese and English advertising the Golden Residence Permit. In exchange for a EUR 500,000 (USD 682,000) real estate investment, the investor gets a Portuguese residence permit that can be converted to permanent residency and citizenship. As Portugal is part of the Schengen Zone, permit holders could travel, live, and work freely in much of continental Europe.

While the doors to the US, Australia, and Europe are open to wealthy foreigners, they are ever more firmly shut for foreigners without means. Deportations, border fences, and militarized intimidation of land crossers and boat people keep out the needy, while investor schemes and student migration pathways draw in the wealthy. Give me not your tired, your poor, and your huddled masses, but your talented and your moneyed elite.