OPINION
This сase arises against the backdrop of the national housing crisis. Nationwide, foreclosures are increasing, construction and purchase of new homes is decreasing, and home values are plummeting. 1 In some ways, the facts presented here echo national trends, but we decide a fairly *1065 narrow question: whether individuals who purchased homes in new developments have standing to sue the developers for injuries allegedly caused by the developers’ practice of marketing neighboring homes to individuals who presented a high risk of foreclosure and abandonment of their homes, financing those high-risk buyers, concealing that information, and misrepresenting the character of the neighborhoods. The district court held that plaintiffs did not have standing because none of the alleged injuries amounted to a concrete, non-conjectural injury-in-fact, and that there was no sufficiently strong causal connection between any injury and defendants’ conduct. It also denied plaintiffs leave to amend their complaints. We reverse and remand fоr further proceedings.
I.
A.
Plaintiffs are individual homeowners who purchased houses in new developments constructed by one of eight large national home-builders between 2004 and 2006. Each of them made a down payment of twenty-percent or more of the home’s purchase price. Defendants are some of the nation’s largest housing developers, and include the developers’ parent companies and subsidiary mortgage companies. Plaintiffs seek damages, attorneys fees and costs, and the option tо rescind their home purchases due to defendants’ fraud, negligent misrepresentation, breach of implied covenant of good faith and fair dealing, and violations of California’s Business and Professional Code (CBPC). They also seek an injunction prohibiting defendants from continuing to engage in practices violating the CBPC or providing mortgage services or financing to buyers purchasing homes from defendants.
Plaintiffs claim that defendants represented that they were building “stable, family neighborhoods occupied by owners of the homes.” Acсording to the plaintiffs, “[ijmplicit in this marketing scheme was that [defendants were making a good-faith effort to sell homes to buyers who they expected could afford to buy the houses and would be stable neighbors.” Nevertheless, defendants marketed the houses to “unqualified buyers who posed an abnormally high risk of foreclosure.” 2 Similarly, plaintiffs claim that defendants represented that they “discourage[ ] speculation ... [and] intended to sell homes only to people who will occupy them,” but sold homes to investors who had no intent to reside in thе homes and were more likely to walk away from the homes in times of economic hardship.
Plaintiffs claim that these misrepresentations and omissions were part of a comprehensive scheme to increase defendants’ profits. They allege that defendants financed at least 65% of the mortgages on homes in their communities. Plaintiffs contend that by marketing homes to high-risk buyers, and by financing buyers who may not have been able to obtain other financing, defendants created a “buying frenzy” that artificially increased demand and homе prices. They maintain that defendants’ marketing and lending practices were material information “related both to the value of their houses and the desirability of the properties.” They allege that “[i]f Defendants had made such disclosures, Plaintiffs would not have purchased the houses from Defendants and/or [sic] would not have paid an inflated price for the house.”
*1066 Plaintiffs aver that since they purchased their homes, “as was inevitable, ... these unqualified and high-foreclosure-risk buyers began to default on their loans leading to foreclosures and short sales.” Their neighborhoods have allegedly had “a number of foreclosures and short sales that have resulted in a substantial loss of value to the surrounding homes.” They allege that the loss was “much greater than if their houses had been located in a neighborhood where Defendants’ scheme ... did not occur.” Plaintiffs further contend that the foreclosures and short sales have “drastically altered” the “desirability” of their properties and neighborhoods, resulting in abandoned houses, multiple families living in one home, transient neighborhoods, and even increased crime.
Plaintiffs’ claims fall into two broad categories. They allege injuries that occurred at the time of sale: namely, that they paid more for their homes than they were actually worth at the time, and that they would not have purchased their homes had defendants made the proper disclosures. We will refer to these claims as plaintiffs’ “overpayment” and “rescission” claims. Plaintiffs also allege injuries that occurred after the sale: that their homes have decreased in economic value and desirаbility as places to live. We will refer to these claims as plaintiffs’ “decreased value” and “decreased desirability” claims.
B.
Defendants each filed a motion to dismiss, arguing that the plaintiffs (1) lacked constitutional and statutory standing; (2) failed to allege their fraud-based claims with particularity as required by Rule 9(b); (3) failed to state a claim as to each cause of action under Rule 12(b)(6). The district court granted all of the motions to dismiss on the grounds that plaintiffs lack constitutional standing.
The district court, relying on three cases presenting similаr facts, concluded that plaintiffs failed to allege a “concrete, particular, and actual injury.”
See Kaing v. Pulte Homes, Inc.,
No. 09-5057 SC,
In addition, the district court held that none of the alleged injuries were “fairly traceable” to defendants’ actions. As to plaintiffs’ decreased value theory, the district court held that any loss in value to plaintiffs’ homes “necessarily depend[s]” on a causal chain including numerous independent forces, including the decisions of “unqualified” buyers to default on their hоmes and the decision of mortgage assignees to foreclose on the defaulted mortgages. Similarly, it held that the decreased desirability of the neighborhood (unkempt yards, transient neighbors, etc.) was not linked to defendants’ conduct by “more than speculation.” Finally, with respect to the overpayment theory, the district court stated that the injury depended on a number of factors inflating housing prices nationwide. Because the district court held that plaintiffs lacked standing, it *1067 dismissed the eases for lack of subject matter jurisdiction and declined to reach the Rule 9 and failure to state a claim arguments. The court also denied plaintiffs’ request to amend in order to introduce expert testimony that could cure any defect in standing and dismissed the cases with prejudice.
II.
“[T]hose who seek to invoke the jurisdiction of the federal courts must satisfy the threshhold requirement imposed by Article III of the Constitution by alleging an actual case or controversy.”
City of Los Angeles v. Lyons,
A.
The district court erroneously concluded that lack of Article III standing was grounds for dismissal under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. Though lack of
statutory
standing requires dismissal fоr failure to state a claim, lack of
Article III
standing requires dismissal for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1).
Simmonds v. Credit Suisse Sec. (USA) LLC,
Moreover, because the district court treated the motion ás a 12(b)(6) motion, it inappropriately applied the standards of
Ashcroft v. Iqbal,
Twombly
and
Iqbal
are ill-suited to application in the constitutional standing context because in determining whether plaintiff states a claim under 12(b)(6), the court necessarily assesses the merits of plaintiffs case. But the threshold question of whether plaintiff has standing (and the court has jurisdiction) is distinct from the merits of his claim. Rather, “[t]he jurisdictional question of standing precedes, and does not require, analysis of the merits.”
Equity Lifestyle Props., Inc. v. Cnty. of San Luis Obispo,
B.
Each element of standing “must be supported ... with the manner and degree of evidence required at the successive stages of the litigation.”
Defenders of Wildlife,
The parties concede, and we agree, that a favorable court decision would redress plaintiffs’ injuries. Accordingly we address only the first two elements of constitutional standing. We conclude that plaintiffs have established injury-in-fact and causation with respect to their overpayment and rescission claims. We hold that decreased value and desirability are concrete injuries-in-fact, but agree with the district court that the current record does not establish a sufficient causal connection between defendants’ actions and plaintiffs’ harms. Nevertheless, we hold that plaintiffs should be permitted to amend their complaint because plаintiffs may be able to establish by amendment that they have standing to pursue their claims.
1. Overpayment and Rescission
a. Injury-Im-Fact.
To qualify as an injury-in-fact, an alleged harm must be “concrete and particularized” and “actual or imminent, not conjectural or hypothetical.”
Laidlaw,
The district court conсluded that the possibility of improvement in the housing market made plaintiffs’ injuries speculative, because it is possible that they could sell their homes for a profit at some point in the future. The district court misapprehended plaintiffs’ allegations. Plaintiffs claim that they paid more for their homes than they were worth at the time of sale. 5 Future recovery in the housing market will not cure plaintiffs’ injuries — if plaintiffs had paid what the homes were worth at the time of sale, they would obtain greater returns if they sold during a time of economic improvement. Further, if plaintiffs would nоt have purchased their homes absent defendants’ misconduct, the injury was created at the moment of fraudulent purchase and is not affected by any changes in the housing market.
*1070
b. Causation.
Defendants would have us require plaintiffs to demonstrate that defendants’ actions are the “proximate cause” of plaintiffs’ injuries. Plaintiffs do not bear so heavy a burden. To survive a motion to dismiss for lack of constitutional standing,
6
plaintiffs must establish a “line of causation” between defendants’ action and their alleged harm that is more than “attenuated.”
Allen v. Wright,
The district court concluded that the “housing bubble, or inflation of housing prices, was a nationwide phenomenon, traceable to variables independent of Defendants’ alleged scheme, such as lax regulatory enforcement, rates of unemployment, credit market developments, and general economic growth.” Accordingly, it held that plaintiffs had not established a sufficient causal connection between defendants’ actions and the allegedly inflated prices paid by plaintiffs. We disagrеe. Construing the facts in the light most favorable to plaintiffs and drawing all inferences in their favor, plaintiffs have sufficiently alleged that defendants, not third parties, inflated the “bubble” in their particular neighborhoods, causing plaintiffs to overpay. Plaintiffs claim that defendants financed a substantial majority of buyers in plaintiffs’ neighborhoods, and were thus able to dictate the terms of a large number of loans and plausibly create demand that would not otherwise have existed. Further, the neighborhoods were new developments, so there was no independent economic baseline against which to assess the neighborhoods’ value. Under these circumstances, plaintiffs can plausibly claim that the “artificial demand” created by defendants’ marketing and financing practices had an identifiable effect on the price they paid for their homes.
The causal connection between defendants’ actions and plaintiffs’ rescission claim is even stronger. Plaintiffs state that they would not have purchased their homes had there been proper disclosure of defendants’ lending practices. There is a direct causal link between defendants’ allegedly faulty disclosure and plaintiffs’ injuries. In sum, we hold that plaintiffs have established both injury and causation sufficient to withstand a motion to dismiss on their claims that (1) they paid more for their homes than they were worth, and (2) they would not have purchased their homes had defendants fully disclosed their practices.
2. Decreased Value and Desirability
a. Injury-in-Fact.
A current reduction in the economic value of one’s
*1071
home is a cognizable injury for constitutional standing purposes. In
Gladstone Realtors v. Vill. of Bellwood,
The district court’s holding to the contrary rests primarily on its conclusion that plaintiffs will not realize any decrease in the value of their property until they attempt to sell (and that the economy may improve in the interim, preventing any loss), so the injury is speculative. The district court’s position cannot be reconciled with
Gladstone, Laidlaw,
and
Barnum Timber
— nothing in those decisions suggests that plaintiffs had attempted or would attempt to sell, оr that selling one’s property is a necessary pre-requisite to claiming injury on account of its decreased value. More fundamentally, the district court’s reasoning misses the thrust of plaintiffs’ claims. Plaintiffs argue that defendants’ acts caused their homes to lose value
above and beyond
those losses caused by general economic conditions. Thus, disregarding the vicissitudes of the national housing market, the portion of the diminution in the value of plaintiffs’ property attributable to defendants’ acts remains. To be sure, plaintiffs would need to quantify the damages resulting from decreased value in order to recover, but that isn’t necessary to establish injury at the pleading stage.
Gladstone,
Relatedly, plaintiffs claim they were injured because the blight resulting from defendants’ lending practices makes their homes less desirable places to live. Decreased quality of life is an injury in fact sufficient to support standing. For example, in
City of Sausalito v. O’Neill,
b. Causation: To support their claim that defendants’ actions resulted in decreased home values, plaintiffs allege that sales of homes subject to foreclosure are “usually well below market value,” and those sales “then become the new comparative sales values for the neighborhood ... [at] a vastly lower market rate.” Thus, on plaintiffs’ theory, the decreased-value injury does not occur until the risk posed by defendants’ lending and disclosure practices comes to fruition in foreclosure. The same is true of plaintiffs’ decreased desirability claim. They contend that foreclosures (not merely the risk of foreclosure) resulted in abandoned homes and other forms of blight.
We agree with the district court that plaintiffs have not established how defendants’ actions
necessarily
result in foreclosure,
8
nor do plaintiffs’ complaints allege that the decreased value is caused by the
risk
posed by their neighbors (even absent foreclosures).
9
Nevertheless, we conclude that, in the circumstances presented, plaintiffs should be permitted to amend their complaint. “Dismissal without leave to amend is improper unless it is clear, upon
de novo
review, that the complaint could not be saved by any amendment.”
Krainski v. Nev. ex rel. Bd. of Regents of Nev. System of Higher Educ.,
Before the district court, plaintiffs offered to amend and produce an expert report distinguishing the effect of defen
*1073
dants’ actions from general economic influences. Expert testimony can be used to explain the causal connection between defendants’ actions and plaintiffs’ injuries, even in the context of other market forces.
Barnum Timber,
III.
We hold that the district court erred in dismissing plaintiffs’ overpayment and rеscission claims for lack of Article III standing. We also hold that plaintiffs’ decreased economic value and desirability are cognizable injuries. While we agree with the district court that, on the current record, plaintiffs have not established a sufficient causal connection between any decreased value and desirability and defendants’ actions, plaintiffs should be permitted to amend their complaint and attach expert testimony on causation. Accordingly, we reverse and remand for further proceedings. 10
Notes
. See generally, Harvard University Joint Center for Housing Studies, The State of the Nation's Housing 2011, available at httр://www. jchs.harvard.edu/publications/ets/011/son 2011.pdf.
. Plaintiffs do not explicitly define what they mean by “unqualified” buyers, but it appears their definition encompasses those with unverified income, poor credit history, or inability to make a down payment of less than 20% of the home's value.
.
See Chapman v. Pier 1 Imports (U.S.) Inc.,
.
See United States v. Students Challenging Regulatory Agency Prоcedures (SCRAP),
.
We reject defendants' argument that, under
Dura Pharmaceuticals, Inc. v. Broudo,
. Defendants' reliance on
Duke Power Co. v. Carolina Envtl. Study Group Inc.,
. Defendants attempt to distinguish thesе cases by arguing that each case involved a physical intrusion onto plaintiffs' property. This distinction is immaterial for the purposes of determining whether plaintiffs have been injured — the decrease in value and desirability exists whether caused by a "physical” or "non-physical” intrusion. The thrust of defendants' argument is that they should not be liable for failing to disclose non-physical factors affecting plaintiffs’ property values. This argument concerns the merits of plaintiffs’ claims, not whether they have standing to pursue them.
.
See Bennett v. Spear,
. Cf. Krottner v. Starbucks Corp.,
. In light of this disposition, we do not reach the issue of whether the district court should have granted defendants’ motions to dismiss for failure to state a claim or failure to plead fraud with particularity.