Pr. William Immigration, Housing Ills Seen as Linked

Prince William County's home prices and its Hispanic population rose in tandem during the first half of this decade, a result of a home-building frenzy that became a powerful magnet for immigrant laborers. They arrived by the thousands, sending housing values even higher.

Many did not come legally. But in the blur of swinging hammers and flying dollar signs, that detail was often overlooked. Illegal immigrants had little trouble finding jobs and not much trouble getting mortgages.

That arrangement has unraveled. Prince William has some of the highest foreclosure rates in the region, with a glut of unsold, depreciating homes. And its elected officials have embarked on one of the most ambitious efforts in the nation to drive out and deport illegal immigrants.

That combination -- an excess of housing and new anti-illegal immigrant policies -- is likely to exacerbate the county's weak real estate market, agents and lenders say. Regardless of one's views on immigration, they say, simple arithmetic dictates that if a lot of residents leave the county, the housing meltdown will only worsen.

"If I'm not welcome somewhere, I'm going to sell my house," said Jose Luis Semidey, a real estate agent whose business in Prince William shut down in August when he laid off 40 employees and moved the company to Reston. The county's anti-illegal immigrant measures, which he and a coalition of other Latino businessmen are fighting, "have accelerated the collapse of the real estate market in the minority community," he said.

In August, the region had the lowest unemployment rate of any metropolitan area in the country. But stories abound in Prince William about Hispanic families leaving for Maryland, the Carolinas, Texas and elsewhere. There are no hard numbers indicating if many residents have left or how many are likely to leave, nor is there a clear picture of what their departure could mean for the county's retailers and other businesses.

The town of Riverside, N.J., tried to target illegal immigrants through several measures last year but reversed course last month under legal and economic pressure and voted to rescind the laws. When a sizable portion of the town's Latin American immigrants left, several businesses closed, and others took a big hit.

In Prince William, an early indicator of the impact of the anti-illegal immigrant policies is likely to be seen in the real estate sector, and the county is a gloomy place in a grim regional market. In two years, from August 2005 to August 2007, home sales fell 66 percent in Prince William, 52 percent in Loudoun County and 49 percent in Fairfax County. The number of properties on the market in Prince William more than doubled, from 2,753 to 6,515.

About 900 of the homes on the market in August were "properties in distress": bank-owned or sliding into foreclosure, said Michael T. Minnery, president of the Prince William Association of Realtors. That is a tenfold increase from 2005, he said.

Many distressed properties are in Zip codes with high concentrations of Latino residents. One county resident told supervisors at a board meeting this week that a house up for auction on her street didn't draw a single bidder, despite an opening price of $259,000. The house used to be worth $400,000, she told the board.

Minnery said it is too soon to know whether Prince William's recently introduced anti-illegal immigrant measures are driving Hispanic residents away or discouraging potential buyers from moving to the county. The association does not have an official position on the policies, but Minnery said he thinks that "anything that puts limits on the housing market is bad."

"Everyone should be able to own a home in this country," he said. "Everyone has the right to home ownership, no matter if they are a U.S. citizen or not."