Migration & Real Estate

For decades, Arizona has been one of several destination goals of illegal immigrants filtering their way into the United States by way of Mexico. The lure of jobs, as a means to earn money to bring other family members across the boarder, coupled with the benefit and assistance programs funded by the taxes of legal citizens, that only illegal immigrants seem to qualify for, have created a steady stream of boarder crossings.

During the recent housing boom, a greater number have made Maricopa County their final destination, and recent news have estimated 12 million illegal immigrants live and work in the United States. The increase of illegals in the local population also helped fuel the housing boom, and now seems to be adding to the real estate and mortgage crisis.

There are no statistics, that I am aware of, on the direct impact or the numbers of illegals effecting the current real estate market. However, in 2007, Arizona foreclosures were up 566% from 2006 with an estimate of 10,000 or more vacant homes on the market, and a prediction of more to come in 2008. With the passing into law of the Employers Sanctions, which took effect January 1, 2008, more companies are laying off undocumented workers to avoid having their licenses suspended or permanently revoked.

These workers who bought homes are no longer able to pay their mortgage which adds to the number of foreclosures and abandoned homes. In addition, many who took advantage of assistance programs to purchase homes, did not have jobs or income to make their payments, and relied on refinancing, in some cases several times, to draw out the increase in equity during the boom.

Recently is has also been reported that several towns along the U.S./Mexico boarder have been gearing up for what they call a “Reverse Wave of Migration”. With Arizona now being labeled as one of the toughest places for illegal immigrants, increases in deportations, and the employer sanctions, many illegals are expected to return south of the boarder. But migrant shelters and human smugglers are telling the illegal immigrants they need to go farther north into the United States for better wages and fewer Border Patrol agents.

Smuggles in Tijuana that normally charged $2,000 for crossing into California or Arizona, are now charging $3,000 to $5,000 to avoid boarder states for more desirable locations such as Oregon, Illinois, Virginia, Maryland, and Washington D.C..

Any way you look at it, where ever they go, many who are leaving Arizona on their own or by deportation, are definitely contributing to the number of foreclosures and the oversupply of housing in the local market.