CHANDLER, ARIZONA – It's not uncommon for two or three immigrant families to share a house and split the mortgage, said immigrant housing expert Gary Painter, an associate professor at USC's School of Policy, Planning and Developmentcolor>. The other typical scenario is immigrants doubling up or tripling up in an apartment to squirrel away money for a down payment for a house.
"It's pretty clear that (immigrants) have a high value in owning a home, perhaps higher than native households," Painter said.
Pedro ultimately concluded that Martin and his wife, Veronica, really wanted an O.C. home of their own. So Pedro, the oldest son who's like a father to his siblings, offered to deed over the Santa Ana home to Martin. It had a much cheaper mortgage than anything Martin might have found. Martin took the house in 2000, agreeing to pull out $35,000 of the home's equity as part of a refinancing for his brother. Pedro took $18,000 of that money and purchased a $90,000 two-bedroom, two-bath home in Perris in Riverside County. Finally, five years after he married, Pedrohad a home just for hiswife, Margarita, and then three children."I like living here," he said. "It's my own house."The boys' mother, Avila, stayed with Martin at the Santa Ana house until she married a few months later and moved to Perris to be closer to Pedro. By 2000, all of Martin's siblings except for his youngest sister and youngest brother had moved out to live their own lives. Shortly thereafter, the two youngest left too.
A DREAM COMES TRUE
Martin wasn't done tapping the wealth of the family's Santa Ana abode.He borrowed another $20,000 against the house to purchase a van and pay down credit-card debt. The family enjoyed its first vacation, a trip to Las Vegas. Martin also started a weekend cell-phone accessory business.Like the Fonseca family, younger Hispanic immigrants take advantage of their real-estate wealth by borrowing against the house to finance a better life or sell their first home for a bigger residence.
It's a stark contrast to the first-generation of older Hispanic immigrants. They view their homes as shelter, not an investment to trade for a bigger home, said Ron Garcia, the immediate past president of the O.C. chapter for the National Association of Hispanic Real Estate Professionals.These older immigrants are also "very reluctant to pull (equity) out of the home," he said. "The goal is to pay off the home and be debt-free. They have a tendency to live in a cash society."Older Asian immigrants are also reluctant to borrow money against the home, said Kinney Yong, real-estate agent for Platinum Properties International in Newport Beach.
However, younger Asian immigrants are increasingly pulling out home equity to remodel their residence, agents say. Also, older Asian immigrants with high income are tapping the wealth in their homes to buy investment properties.Martin Fonseca found borrowing against housing profits ballooned his debt load and made life harder for the couple. The family's income plus rentfrom boarders - a couple and their child - barely covered the payments for the mortgage, two cars and a hefty health-insurance bill for Martin, his wife and two sons. "We were living paycheck to paycheck," said Martin, who then was the supervisor of a cell-phone accessory company. "I worried about losing the home to the bank and becoming homeless."
The financial strain gave Martin headaches. He couldn't sleep. He cried. Then last summer, his niece from Arizona urged Martin's family to move to her neighborhood in Chandler, about half an hour southeast of Phoenix.Once they saw how cheap Chandler homes were, the decision was easy.The Fonsecas sold their Santa Ana abode for $455,000 in October and pocketed a $225,000 profit. It was so cool to suddenly be rich that Martin Fonseca gleefully asked the bank teller - even though he already knew - to tell him the balance in his account.
"There's no possible way I could save that much money, even if I work my entire life," Martin said.The family spent $165,000 of that windfall to pay - in full - for a 10-year-old Chandler house. It comes with three bedrooms, two baths, a real fireplace and an electric garage opener and laundry room - two luxuries they never had before.
Next, they eliminated the debt for their wheels, a Saturn L300 and a Ford Windstar. They recently gave Pedro the minivan and bought a Pontiac Montana. The total bill was $27,000. Another $11,000 erased their credit-card debt. About $15,000 remains to start a cell-phone accessory business."I wake up and I realize I have no house payments, no car payments, no credit-card payments," Martin said. "It's a great feeling." Martin is in awe of his good fortune: Owning a house created an opportunity to dramatically improve the quality of his life.
"To be able to own a home is one of the primary ways to accrue wealth," USC professor Painter said.
Housing profits present Martin a priceless gift- time with his family. Martin, who once toiled seven days a week, now only needs to work Fridays and weekends at a swap meet selling cell-phone accessories. He relishes the personal moments. He walks Martin David to school, puts his son Erik David down for a nap, barbecues dinners for his family and watches movies with his wife, who's pregnant with their third child.
"I'm only 35. My wife is 33," he said. "In a way, it's an early retirement. It's an achievement I never thought was possible."