New arrivals to America’s shores may have financial and cultural challenges that earlier immigrants couldn’t have imagined. But today’s foreign-born residents are retelling the same story as the waves of immigrants who preceded them did about their quest for a better life, freedom, and prosperity, all of which continue to be measured, in part, by owning a home.

For Pranav Bhatt, homeownership is a matter of size and distance: He’s looking for a four-bedroom house that’s within 20 miles of his workplace at Siemens in Princeton, N.J., where he’s a software developer. Arney Mendez, a finance manager for a Ford dealership in Miami, recalls that his one “must have” for the home he bought last year was either a swimming pool or proximity to a lake. Mendez’s ultimate goal is to live by the ocean, and when asked if that dream is attainable, he responds, “Of course,” and then adds with a laugh, “I play [the lottery] every Saturday and Wednesday.”

The road to ownership for foreign-born buyers has its bumps, as Ana Lopez found out when she lost her job as a cost analyst for Aecom this spring, only eight months after she bought a 3,115-square-foot, two-family house for $196,000 in Lowell, Mass., with $8,000 in down-payment assistance through a local nonprofit housing group. (See “Helping Hand.") Luckily for Lopez she’s collecting $750 in monthly rent from her brother Junior, who lives with his wife and two children on the first floor. Nanta Buranakanchana, a jewelry store owner in Chicago, has owned several homes since coming to America in 1969. But practice doesn’t always make perfect, and in May she was trying to unload five investment condos she bought three years earlier.

FINALLY ARRIVED: Cambodian-American Tooch Van, wife Chorvy, and son Winston, outside the Lowell, Mass., home they bought with help from a local housing group.

Credit: Matt Teuten

These buyers—who emigrated to the U.S. from, respectively, India, Cuba, the Dominion Republic, and Thailand, and whose ages range from early 30s to mid 60s—are among the nearly 40 million foreign born living here, about 54 percent of whom arrived from Latin American countries, according to the latest Census estimates. Through the 2000s, immigrants accounted for 29 percent of the household growth in the U.S., versus 19 percent in the 1990s and 10 percent in the 1980s, according to Dowell Myers, a professor of urban planning and demography at the University of Southern California. Myers notes that more than half of all Latino immigrants in the Golden State own homes.

Latinos are not alone in their pursuit of the American dream. “The desire for ownership is profound in the Asian community,” says Jim Park, president of the San Diego–based Asian Real Estate Association of America, which represents 10,000 Realtors in 38 states. “Homeownership is a priority for Cubans,” adds Rei Mesa, president of Prudential Florida Realty in Miami, who oversees 52 sales offices.

Many builders peg their future growth on what once looked like an endlessly expanding immigrant population, and with good reason: Data released this April by the Pew Hispanic Center confirm that homeownership rates for both legal and undocumented immigrants rise after they’ve been here more than a decade (see “Sticking Around").

But as the recent economic crisis has closed off job opportunities, this immigrant wave is ebbing. Between 2007 and 2008, only 1.15 million newcomers from other countries arrived, the lowest government-recorded number in 13 years. Citing data from Mexico’s government, The New York Times reported in May that for the year ended in August 2008, 226,000 fewer Mexicans emigrated to other countries, a 25 percent decline from the previous year. Historically, the vast majority of emigrating Mexicans go to the U.S. “There is no question the downturn has muted the growth of foreign-born households,” says Nic Retsinas, director of the Joint Center for Housing Studies in Cambridge, Mass.

Even so, Retsinas believes immigrant buyers will be a force in the housing market for decades to come. But builders that don’t maintain a fresh perspective about what kinds of homes these buyers want, how they pay for them, and who they trust in making those decisions (Hint: It’s their real estate agent), run the risk of devising sales and marketing strategies that miss their targets. “An absolute, complete knowledge [of immigrant buyers] isn’t just nice anymore; it’s critical,” says Bob Schultz of New Home Sales Specialists in Boca Raton, Fla.

FAMILY, REDEFINED

About 18 months ago, Oklahoma-based Ideal Homes wanted to generate more sales from local Hispanic buyers. It set out to do customer profiles based on the 20,000 prospects who visited its models and those who bought a house. What Ideal discovered, says director of marketing Steve Shoemaker, is “we are actually very appealing to an Asian buyer.” Ideal gets about 35 percent of its business from referrals and 33 percent from real estate agents, both of which are reliable avenues to Asian prospects. Ideal’s ads “play up the family angle,” which resonates with immigrants in general and Asians in particular. And the builder’s energy-efficient homes offer “a value message” to immigrant buyers.

While by no means monolithic, immigrant buyer groups do share characteristics that builders can latch onto. Foremost is the centrality of family and how that affects what homes they will consider buying.

Phil Jones, the broker/owner of Coldwell Banker Coastal Alliance, points to one client, an Egypt-born oil executive, who is renting a $2.5 million house in Long Beach, Calif., for four months. Despite his wealth, the executive may not be the decision-maker. “His children, wife, and father will decide whether they want to buy it,” says Jones, a sign of the importance of families. Michael Lee, president of the multicultural marketing and sales training firm EthnoConnect, says the very definition of “family” differs for immigrants, who often have more children and relatives living with them—and occasionally doubling up in bedrooms—than do other buyer groups.

Long Beach reputedly harbors the world’s largest Cambodian population outside of Cambodia. There are large immigrant enclaves throughout the country: Iranians in West Los Angeles, Somalis and Ethiopians in Lewiston, Maine; Arabs in Detroit, Iraqis in Minneapolis, Cubans in Miami, to say nothing of other Hispanic immigrants who make Texas, California, and Arizona their home.

Vipul Patel, who owns a pharmacy in Jersey City, NJ, with his realtor, Prudential's Pratiksha Kumar, photographed in the building across from his business that is currently being renovated to house his pharmacy in the downstairs commercial space.

Credit: Katja Heinemann

SIZE MATTERS

Another characteristic that links immigrant buyers is their penchant for bigger homes with decent-sized yards to accommodate large and extended families. “Large,” though, doesn’t mean “McMansion” for immigrant buyers, cautions Retsinas. It usually has more to do with room count.

Bhatt, who emigrated from India in 1995 with his mother, and who recently married, told Builder this spring that he’s looking to purchase a single-family house in the $475,000 to $530,000 range, with a basement and garage, and a room on the first floor where his parents could stay when they visit. (He’s keeping his townhouse, which he’ll rent to his brother.)

The curb appeal of the house, the security of the neighborhood, and the quality of nearby schools are important factors for immigrants. But when it comes down to what they actually buy, Realtors and demographers say Hispanics tend to gravitate toward existing homes they can fix up or upgrade. The 2,020-square-foot, single-family foreclosure home in the Miami suburb of West Kendall that Mendez paid $316,000 for last fall needed another $20,000 or so in work that included a paint job, bathroom renovation, and upstairs flooring and stair replacements.

By contrast, Asians lean toward new homes, as a status symbol and because “they don’t want to have to fix things,” says Pratiksha Kumar, a Prudential agent in Watchung, N.J., who deals a lot with Indian-born professionals. But finding something new they like is another matter (see “Prescription Refill,” page 48), and has been a problem for a while: Buranakanchana says she searched for a new home for two years before spending more than $500,000 in 1997 on the four-bedroom custom home in Glenview, Ill., where she lives today.

While it’s rarely a deal breaker, some Asians desire homes that are built to the aesthetic system known as Feng Shui. That system touches upon everything from the house’s position to the sun, how the front and back doors open, whether its interior corners are finished, where toilets are located, even the house’s color and its street address numbers. “Some people are very strict about this,” says Park.

DEAL OR NO DEAL

Norma Hinojosa, the co-owner of RE/MAX Elite in the border town of Mission, Texas, gets about 30 percent of her business from Mexican nationals who are purchasing second homes in the U.S. A recent client, an architect, plunked down $600,000 in cash for one house and $200,000 for another he’ll live in while he renovates the pricier abode. “I wish I had more clients like this,” says Hinojosa. Mesa, the Miami broker, says his Cuban-born clients often favor making big down payments and want 15-year mortgages.

These are exceptions, though, among Hispanic buyers, whom Realtors say generally have lower incomes than other immigrant groups, put down the minimum, and often need mortgage assistance. Myers observes that most Hispanics in California are buying homes at about 75 percent of the median price. Hinojosa adds “the guidelines are a little different” even for her affluent immigrant clients who borrow through American banks that demand from them “25 percent to 30 percent down,” and full income documentation. Hinojosa’s assistant, Adriana Valdes, says that because her American-born husband—who spent most of his life in Mexico until the couple relocated to Texas from Mexico City in 2007—hadn’t established a credit history, they had to put down 25 percent on a $152,000 house they closed on in June 2008. He also had to show the bank financial statements from his computer equipment business in Mexico to secure the mortgage.

“When bank underwriters look at a foreign-born person, they will be more conservative about gray areas and demanding about documentation,” observes Chris Nelson, director of the Metropolitan Research Center at the University of Utah, who has done extensive analyses of home buying patterns. “That will keep homeownership rates of [the] foreign born lower. They will be buying smaller homes as a result, or not buying at all.”

Nelson’s observation about banks might explain some Asians’ aversion to borrowing altogether. Park notes that Asians own more small businesses than any other ethnic group in America. Their entrepreneurial spirit, though, can be a double-edged sword when those businesses deal mainly in cash, and mortgage lenders require income documentation. While Asian buyers may be better financed than other immigrant groups, their money sources aren’t always transparent, say real estate agents. By reputation, though, Asians are big savers, and Korean families in particular are known to pool their resources to buy houses and businesses.

Lee and other sources also point out that Asian immigrant buyers are tough negotiators who haggle over everything, including the price of a house. “They are never done negotiating, even after escrow,” says Jones of Coldwell Banker.

NEWFOUND FRIENDS

That being said, buying a home in the U.S. is still confusing and intimidating for many immigrant buyers. Not surprisingly, they look for someone they can trust. Builders who want to tap into these groups must acknowledge the role that Realtors play as confidants and guides through the home search and buying process. Kumar, who is known to her adoring clients by her nickname Preet, says her fluency in English, Gujarati, Hindi, Marathi, and Punjabi, is “a big advantage with customers who want to work with someone who has the same background,” she says.

“They’ll have you over for dinner, bring you gifts,” says Grace Olson, an agent with Coldwell Banker in Long Beach, Calif., about her immigrant clients. Arney Mendez goes even further: He says his broker, Prudential’s Miguel Solis, “is now like one of the family.”