Birth of federal housing policy, which saw its precursors in cities like new york and chicago. So you could make a strong argument that immigration itself is what gave birth to our federal housing policy today. Our panel will be a little less historical, except for the last decade. Our panel is going to look at recent trends, especially in like of the recent housing boom and bust, which coincided with a Significant Movement of immigration. We are offering connections between immigration and real estate. Jacobrst speaker will be vigdor, from the university of washington. That is the other washington, the one with good coffee and a little more rain, although i think we probably rival you in humidity. In addition to his many journal publications, vigdor is the author of from an address to americans the rise and fall of fitting in. Next guest will be gary painter, who serves as a professor at the university of southern california, as well as a director of Public Policy at sol. His numerous journal publications, particularly on housing in the great recession, have interdicted immensely to our understanding of housing dynamics during the recent crisis. Our final speaker, susan wacht professor at the Wharton School at the university of pennsylvania, as well as of city and Regional Planning at the university of pennsylvania. I was fortunate to know susan 20 years ago, when she was assistant secretary for policy directing and research at the u. S. Department of housing and urban development. I have been even more fortunate that since that time she has been willing to sell to share her insights on mortgage policy and housing policy. I do not think it is an exaggeration to say if there is an important policy question about the mortgage market, susan has probably written something on it. Quite prolific, as all of our panel is. With that, i want to turn over the podium to jacob. I am here from the other washington, i have to set the record straight. The humidity is no contest. There is a difference between being damp and being human. And if anybody is unclear on that, come home with me. I am going to talk about today is part of a project that i worked on that is looking a little bit broadly at the impact of immigration on communities across the United States. Only a short amount of time to i will you today, so keep moving. There are some things we have to do with the data to understand the impact of immigration on local communities. I am looking specifically what is the impact of immigration to a local community on the Housing Market happens to the price of housing in the community . What happens to manufacturing employment . And immigrants move in, do natives leave coordinates arrive . Information using counties between 1970 through 2010. That is what we are going to talk about. The stuff i am going to talk to you about today is building on the work of quite a few other people, some of whom are with us today. A lot of work. We heard about immigration and the labor market early today. I am following up a couple other studies of immigration in the Housing Market that looked at slightly broader levels at state level or metropolitan area data. I am going down to the level of the county. Lets talk about immigration and housing. It is a basic story of supply and demand. That is the basic way we teach this, right . There is demand for housing and a supply of housing. You can draw these little supply and demand curves in various different ways, but the basic idea is this. Immigration increases the number of people who need a place to live. So the impact on the Housing Market is fairly straightforward. You have some common nation of more houses being built and increase prices. Depending on how easy it is to build new structures, you might have more effect on the price side or the supply side. That is what we might call the direct effect. In addition to these direct effect on the Housing Market, there could be what we might call indirect effects. The arrival of immigrants in the community could lead some people might perceive the Community Less desirable. Native flight natives might look at immigrants coming into a community and say they do not want to live there. Demand forreduce housing. There could also be effective natives are displaced in the labor market. The indirect effects of immigrants arriving in the Housing Market could also be positive. It could mean better opportunities for the local residents. The could also be positive impacts on the local quality of life. We will have the opportunity to talk little bit about some of these things. The positive impacts look very important. One thing immigrants have done they have gone into a lot of declining the records in cities and neighborhoods that in the 1970s were declining have no stable is, in large part because they are repopulated with have now stabilized, in large part because they were repopulated by immigrant communities. Is it positive to have higher Housing Prices . If you own your home, higher Housing Prices means more wealth. If you are a renter or someone who is trying to turn into a homeowner, higher prices are a mixed bag. It may mean more money out of pocket, but generally speaking, we think you are paying that more money because what you are renting has become more valuable. More of alittle bit complicated thing. If we were doing this analysis from a strict costbenefit perspective, we would refer to a lot of these things as transfers. The price going up, yes, it does mean that peoples wealth has gone up. Renters, thes price of rent goes up. Forward intoght the analysis that i did, i got population and housing data from the county level for just about every county in the United States, from 1972 2010. I had to toss out alaska. Alaska does not really have counties. It i ended up countysample of 3109 equivalents. What happens is a punch and of the foreignborn population . I look at the native population and home values. I try to take up a longterm differences between counties, so i am not directly comparing with manhattan and rural iowa. Im studying, over time, it happens to that community as immigrants into the community. I have slides that get into a lot of detail about reform. Modelingwant to be this . I am going to wake my hands a little bit. If you can read fast, it is all there. The servers and is, i looked to see what kind of model best fits the data, and i looked at that. It was a basic, linear model. Surprise, surprise. It is inflationadjusted, so it is easy to explain. Im also going to be incorporating data from county Business Patterns, to look at what is happening in manufacturing across counties. County Business Patterns places that do not have a lot of were taken out of this analysis, so that leaves me with about 2000 counties. A lot of people who do this work, you run into this problem. You see in france move into the community and Housing Prices go up. Is that a case of immigrants causing Housing Prices to go up, or is it just the case that immigrants are moving to places that are successful . They are not going to places where the population is declining, where the Housing Market is in a downward spiral. I am pursuing a strategy of trying to get around that chicken and egg problem by identifying immigration into a economicat looks at conditions on the ground. It is a well established veteran that immigrants of the counties where there are already immigrants in the population. I am using a strategy that has been used for at least 20 years in economics to predict where immigrants will go as a function of where immigrants were distributed as of 1970. Right . Distribute this back to some work that was done in the early 90s. There is a lot more detail about it. If you can get the whole story. If you can read fast, you can get the whole story. I am doing something very similar with the manufacturing analysis, which is a little bit different, instead of looking at Something Like housing crisis. It is manufacturing jobs. I only have data on that. The Housing Price analysis, i am 90, 2000,rom 70, 80, 2010. Here is what the results look like. I want to show you is, i can predict where immigrants are going to go as a prediction of where immigrants were in 1970. I have what i call the shift share base forecast. This is my variable that predicts where immigrants will locate as a option of where immigrants lived in 1990. 1970. Where will we have immigrants from honduras in 2010 . In 1970, there were not a lot of immigrants from honduras. But what counties where they located in . The prediction is that they are going to find a particular concentration of hondurans in the counties that had a lot of hondurans back in 1970. What we find is that this is not a perfect redactor. We talked about immigrants going to new destinations. One of the phenomena we see is that immigrants in the past 10 or 20 years have gone to places like the Intermountain West and the southeast, places that did not have large immigrant populations in the 1970s. So this forecast messes up with those types of counties. But it is really good about forecasting the growth of the immigrant population in california, the northeast, florida, and parts of the midwest. So it works pretty well. Strategy kind of does what it is supposed to do. Here is the result of the greatest interest for this particular panel. When i look to see, what is the impact of immigration on the Housing Market, i get that little coefficient at the top that is 0. 116. When one immigrant moves into a county, on average, Housing Prices in that county go up by 11. 6 cents. Sounds like a small number, and it is a pretty small number. But i am going to go through a little calculation in a little while to show how this 11. 6 cents turns into about 3. 6 million. That is the total impact of immigration on housing wealth in the United States. I have quite a few different control variables in their that are less interesting for the discussion. I will take you to migrate some efforts later on. Effortsyou through my later on. When an immigrant moves into a county, the nativeborn population stays the same. An increased is not chase the nativeborn away. Natives are actually drawn to counties with immigration. As evidencethis that immigration increases the amount of Economic Opportunity in the county. This is the idea that there is finite there is not a finite economy in place. The Service Sector needs people to serve. If you bring a thousand immigrants into a county, you would get 423 extra natives. Some of those natives are the children of foreignborn. We do an adjustment based on the childbearing rate of immigrants. The net impact is about 270. Thousand immigrants from a county forecast 270 additional natives moved to the county. Thisufacturing analysis is showing you that the strategy of predicting where immigrants will go as a basis of where they were in 1970, here is what we get. When you get a thousand foreignborn individuals moving into a county, the number of manufacturing jobs increases by about 42. Immigration, in the context of an economy where manufacturing jobs generally are declining this is saying that the loss of ens incturing jobs less counties that seymour immigration. You have 8 of the workforce in manufacturing. Just under 70 of the Adult Population is in the workforce. The manufacturing jobs created increases with the number of foreignborn people who live there. Second strike slide on implications, adding 1000 immigrants draws in 270 natives. That is something we have talked about already. Here is the way we want to think about the housing. If a thousand immigrants moving to a community, the forecast is that median home values will increase by about 116. It is time to do a back of the envelope calculation. The average immigrant resides in the county with a hundred thousand houses. Houses, with 800,000 in larger urban areas. So if you think about it, one immigrant moving into a county with 800,000 Housing Units, they are raising the median price by 11. 6 cents. 800,000 istimes 90,000. Basically, the dowry to the theunity, the effect on Community Housing wealth, is a grand total of 90,000. 90,000 per immigrant. We have approximately 40 Million Immigrants in the United States. You just have to take those numbers and multiply them. 40 million times 90,000 gives impact of trillion creation of housing wealth. I should be clear about this. This is Owner Occupied and rental housing. This is what it is. It is a straightforward story. There are more people who want Housing Units. I should mention that this Statistical Analysis is not really looking at the impact on construction. If you look at the impact on prices, this is the implication you get. Thank you. [applause] gary i would also like to thank alex and cato for having us here today. I think what is interesting about all the panels have a slightly different definition. I should say that one of the things that i wanted to emphasize, and i think this is true of the panel at large, is that when we are talking about immigrants, we are talking about with authorization and without. This is about people who come from other places. It is my hope that in my talk, although in a gathering like this, it might be impossible, that maybe i will share one new fact or one new piece of data in a way you have not seen before. Facts forinteresting how we might think about immigrants in the Housing Market. As our moderator opened up today, one of the aspects and where i have done most of my work is in the area of understanding immigrant Housing Demand, and understanding how it may or may not be similar to nativeborn housing. That is where i am went to focus most of my attention. The nice thing is that my colleagues are very complement to read in terms of our expertise and research. Very come from entering very complimentary in terms of our expertise and research. Are not arkets national phenomenon. Housing markets are local. We have to think of them as a collection of localities. We have to keep in mind that Immigration Trends can change rapidly. Is not aword immigrant homogenous category by any means. There are multiple dimensions of which i will only go through a few, in understanding immigrant housing. Trends in immigration flows aress the u. S. , the maps somewhat large on the screen behind me. This is one of those nice screens that eat laser printers. Unfortunately, i cannot show you anything in particular. Let me show you what these formats are going to be. The first map is mapping out the percent of the foreignborn population as a percentage of the total. The different shades are different quintiles. ,t is divided into a bucket where there are the largest concentrations. Not surprisingly, the immigrant new york, miami, california are the darkest. As we know, over time, it has been migration across the u. S. What i did not do is change the quintile bucket, so things just get darker over time. I have not changed the definition. In 1990, it was mostly in the southwest, and california and new york. 2000 and 2010, there is substantial migration throughout the u. S. So nothing new there. The percent latino foreignborn population is one dimension where perhaps there could be some different clues. It could be shown in the same way. Perhaps not surprisingly, because of until very recently, latino migrants, the foreignborn from latin america, where the largest group. The map approximates what we saw on the previous. The dark shades are often traditional immigrant gateways. By 2000 and 2010, migration has spread. The asian population has a similar spread, but if you want in 1980,losely, back to be in the top quintile, you only had to have a population of 4. 4 asian immigrants. These are very much impressed. But what i find most interesting in this series of maps is, think about, where are the new immigrants as a percent of the total foreignborn population . 1990, look at 1980 and you see that most immigrants were new. You see lots of dark. And when you step to 2010, you see that most immigrants that are new are no longer in immigrant gateways. So the places like california, florida, texas, and so forth, these are very light shades. Less than 20 of the immigration population is new. That says a lot about the background. If you are in places where there theres of new immigrants, might be different challenges or opportunities. That is something to keep in mind. Thing i focused on was the immigrant Housing Market. I thought immigrants had been ignored in the housing data. Your mark inmake something. So i showed up in the 1990s, realizing, i am not exactly sure why they have been ignored. One theory of herd is, they are transient. They come in and come out. Impact onot a big Housing Demand in one place, because you never know if they are going to stay. One fact i have been surprised at and not Everybody Knows is that immigrants are now no longer more mobile than the native population. In fact, they are less mobile across state borders once they arrived. That means immigrant populations than themore stable nativeborn population. So this was shocking to me, when i started to look at the data. This is data from the Current Population survey. When i started doing my work, as you see, the underlying mobility of the immigrant tuition, when your mobility, was close to 20 quite high. Native population was closer to 50 . This includes interurban or interstate moves. Period,he end of the the green line is below the purple. When i got to the data, i knew this was happening, but i