Rep. Pat Harrigan (R-N.C.) announced plans to introduce the Real Estate Reciprocity Act, a bill aimed at addressing foreign entities purchasing U.S. real estate while Americans are barred from buying property in those entities’ home countries. The legislation seeks to impose restrictions and financial penalties to ensure fairness in international property transactions.
The Real Estate Reciprocity Act would impose a 50% tax on real estate purchases by foreign nationals or entities with government ties from countries that prohibit Americans from owning property.
Harrigan told Fox News Digital, “While American families struggle to afford a home, foreign adversaries are buying up our country with cash – farmland, neighborhoods, even land near military bases. These regimes ban Americans from buying land on their soil, but think they can carve up ours.” The bill aims to deter such purchases and protect U.S. land resources.
Mechanisms of the Proposed Bill
Under the proposed legislation, foreign nationals purchasing U.S. land would be required to file with the Internal Revenue Service (IRS), ensuring transparency in these transactions. Additionally, the bill mandates that the Secretary of State provide an annual report identifying countries that restrict U.S. citizens from owning real estate.
Harrigan emphasized the bill’s intent, stating, “My Real Estate Reciprocity Act stops it cold with a 50% tax on every purchase, mandatory disclosure, and protections for the ground we raise our kids on. If Americans can’t buy land in your country, you won’t be able to buy land in ours.”
The legislation responds to concerns about foreign ownership, particularly in strategic areas like farmland and properties near military bases. It aligns with efforts to address national security risks associated with foreign land acquisitions, especially by entities from countries like China.
Global Context of Property Restrictions
Several nations impose strict rules on foreign property ownership, creating an imbalance in real estate reciprocity. Countries such as Switzerland, New Zealand, Denmark, the Philippines, Poland, and Vietnam have stringent regulations or outright bans on foreigners purchasing land. In nations like China and Saudi Arabia, while direct land purchases by foreigners are prohibited, investment in real estate is often permitted, highlighting varied approaches to foreign ownership.
Foreign buyers have been linked to rising housing costs in U.S. metropolitan areas, such as New York City, where they purchase high-value properties as investment assets. This trend has fueled local frustrations, as it contributes to affordability challenges for American families.
Foreign Ownership of U.S. Land
As of 2022, foreign entities and individuals held 43.4 million acres of U.S. agricultural land, representing nearly 2% of all U.S. land. Canada leads as the largest foreign holder, with 12.8 million acres as of 2021—an area larger than the combined size of New Hampshire and Vermont. This significant foreign ownership has raised alarms about the potential impact on U.S. food security and national interests.
The bill is part of a wave of legislative efforts targeting foreign land purchases, particularly those by Chinese entities near U.S. military installations. Such acquisitions have prompted concerns about espionage and strategic vulnerabilities, driving bipartisan support for stricter regulations.
Implications for U.S. Policy
Harrigan’s legislation reflects growing scrutiny of foreign influence in U.S. real estate markets and aims to level the playing field for American citizens.
By imposing a substantial tax and requiring transparency, the Real Estate Reciprocity Act seeks to deter purchases by entities from non-reciprocal countries while safeguarding critical U.S. assets.
The annual State Department reports would further enhance oversight, providing data to inform future policy decisions.
As housing affordability remains a pressing issue and national security concerns intensify, the bill emphasizes the intersection of economic fairness and strategic interests. Its progress through Congress will likely spark further debate about balancing open markets with protections for American land and resources.
