Would Increasing Immigration Help the Housing Crisis?

According to a news story I read today (but, convinently, cannot find right now), there are 600,000 houses sitting empty now, owned by investors but sitting unwanted. One would think this is a pretty major reason for falling home prices, which is part of the reason credit markets are so gummed up now. Also, it's certainly probably that both the supply and demand for housing is fairly inelastic (right?), so a small increase in demand could lead to surprisingly large price increases.

So how about this for an 'emergency' measure to help the economy: Issue 1 million extra visas this year. I'm partial to Arnold Kling's visa auction proposal, but it could be done other ways. But if the U.S. could sell 1 million visas for $20,000 each (has anyone ever tried to estimate the market value of a U.S. work visa before?), we have a lot more play money for emergency 'bailouts' and the like, not to mention the housing effects.

Now, I should say as a renter, I'm pretty annoyed that everyone assumes that high housing prices are great, though this is partially counterbalanced by my amusement in seeing self-styled liberals and "affordable housing" advocates screaming about how bad falling housing prices are. Nevertheless, I'd certainly trade slightly higher home prices for avoiding a major recession. And if doing so, we can attract more of the best and brightest, that's a double gain.

Share this