H-1B Visa Holders Disappear from US Housing Market

The number of new FHA mortgages granted to non-permanent residents has dropped to near-zero following President Donald Trump’s recent executive orders targeting immigrants, according to new data. 

In a March 26 letter, the Department of Housing and Urban Development announced that non-permanent residents in the United States, including H-1B visa holders, would no longer be eligible for mortgages insured by the Federal Housing Administration (FHA), effective May 25.

The move, the letter said, was in line with President Donald Trump’s “commitment to safeguarding economic opportunities for U.S. citizens and lawful permanent residents,” while also ensuring that “federal benefits, including access to FHA-insured mortgages, are reserved for individuals who hold lawful permanent resident status.”

The impact of these policy changes has already become evident in the U.S. housing market, “reshaping the housing market for non-permanent residents,” Alex Thomas of John Burns Research & Consulting (JBREC) posted on X.

What Do The Latest Numbers Show?

A new report by JBREC, authored by Thomas and colleagues Eric Finnigan and Zack Ray, found that non-permanent residents, also referred to as NPRs, made up less than 1 percent of FHA loan volume nationally in June, down from nearly 5.5 percent a month earlier and over 6 percent in April. 

In July and August, the share of non-permanent residents securing the government-backed loans issued by the FHA was near zero percent. That was the lowest level in the timeline provided by JBREC, which dates back to February 2018. 

“New FHA mortgages to NPRs have dropped to near-zero following a rule change in May,” Alex Thomas, one of the experts behind JBREC’s new report, wrote on X. “NPRs made up ~4 percent of FHA loan volume nationally in 2024; more in some markets, especially in Florida.”

Thomas told Newsweek that the results were largely in line with our expectations. “Policy shifts in housing finance often show up quickly in the data. We also saw a clear surge in FHA loan locks by non-permanent residents in April and May, when NPR borrowers rushed to lock in their loan before the new rule took effect at the end of May,” he said.

Why Are NPRs Not Getting Many FHA Mortgages?

The reason why the number of FHA loans going to non-permanent residents has dropped in recent months, according to Thomas, is mostly that they are not buying anymore. 

Unable to access FHA loans, non-permanent residents now have to rely on other options, including conventional loans, which the federal government does not guarantee. These, however, require a good credit score, which many might not have, along with other requirements such as U.S. income and employment documents.

“Non-permanent residents can still use conventional financing to secure a mortgage,” Thomas said. “However, FHA financing is often used because of its more lenient underwriting requirements. NPR borrowers who are now locked out of FHA loans may not be able to qualify for conventional loans, and we have seen a dip in overall volume of mortgages going to non-permanent residents over the last several months.”

The strictness of these requirements shows that the Trump administration’s new policies, combined with the current high cost of home-buying, have severely hindered non-permanent residents’ ability to step onto the property ladder, according to the latest data.

What Impact Would This Have on the Housing Market?

According to Finnigan, the FHA’s ban on lending to H-1B visa holders and other non-permanent residents in May is squeezing “entry-level home-buying in some key housing markets already dealing with weak sales & too much supply,” as he wrote on X.

It is also making it less appealing for H-1B visa holders to be in the U.S., especially after Trump issued a presidential proclamation last month creating a $100,000 application fee for the visa.

Several experts and employers have warned that the fee could harm American businesses, which might struggle to attract skilled workers. 

“This executive order stifles a legal immigration program on which many American businesses depend—with effects that benefit Americans and the U.S. economy,” Jennie Murray, President and CEO of the National Immigration Forum, previously said in a statement to Newsweek.

Thomas told Newsweek that at the national level, the impact of the ban on non-permanent residents is relatively small. “Non-permanent residents made up just 4 percent of FHA loan volume in 2024, and were historically just 2-3 percent of FHA loan volume,” he said.

“Because there’s no cap on the number of FHA loans, non-permanent residents weren’t competing with U.S. citizens or permanent residents for limited financing. For permanent residents, the main barrier to homeownership today is poor affordability—a function of high home prices, high mortgage rates, and rising homeownership expenses,” he added.

The impact will be more noticeable in markets where non-permanent residents represent a larger share of FHA loan volume—particularly parts of Florida and Texas, Thomas said, where JBREC analysis suggests we could see a more meaningful pullback in demand.

Correction and update 10/16/25 08:51 a.m. ET: This article was updated to correct the new fee for the H-1B, having previously stated it was $1,000, and to add comment from Alex Thomas.