Immigration's Housing Impact
Federal Reserve Paper Links Unauthorized Immigration Surge to Rising Home and Rent Prices
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A Federal Reserve Bank of Dallas working paper has found that the record surge in illegal immigration from 2021 to 2024 coincided with higher home prices and rents across U.S. metro areas, according to Idaho News. The paper calls the period an "unprecedented boom in unauthorized immigration" and examines how those worker flows affected both housing and labor markets.
The paper quickly gained political attention. President Trump and former acting ICE Director Jonathan Fahey were among the Trump administration officials who shared the findings, according to KOMO News.
What the Dallas Fed Paper Actually Found
The Dallas Fed working paper focused on unauthorized immigrant worker flows into specific metro areas. It found that metros with larger surges in illegal immigration saw measurable increases in both home prices and rents, according to KUTV. The study looked at data spanning the Biden administration years of 2021 through 2024.
Working papers are research drafts. They have not yet gone through full peer review. That means the findings are preliminary and could change. Still, research from Federal Reserve banks carries significant weight in policy debates, according to Turn To 10.
Housing Demand Rose as Immigrant Population Grew
The core argument in the paper is straightforward. More people moving into an area means more demand for housing. When housing supply does not keep up, prices go up. The paper links the sharp rise in unauthorized immigrants to exactly that kind of demand pressure, according to Bakersfield Now.
Rents and home prices were already rising after the COVID-19 pandemic. The paper suggests the immigration surge added additional upward pressure on top of those existing trends, according to News Channel 9.
Trump Officials Seize on Report to Justify Crackdowns
The White House and Trump allies moved quickly to amplify the paper's findings. President Trump shared the report directly, framing it as evidence that illegal immigration drove up housing costs for American families, according to Fox San Antonio. Former acting ICE Director Jonathan Fahey also shared the findings publicly.
The paper gives the administration a research-backed talking point. Housing affordability has been a top concern for American voters. Tying immigration to higher rents lets officials argue that border enforcement could help bring costs down, according to WSET.
Economists Urge Caution on Cause and Effect
A key word in the paper's title is "coincided." That means the two trends happened at the same time. It does not prove that one caused the other. Many economists point out that housing shortages, high interest rates, and supply chain problems also drove prices up during the same period, according to News 3 Las Vegas.
The Dallas Fed paper is one piece of a much larger debate. Researchers have long argued about whether immigration raises or lowers housing costs overall. Some studies show immigrants also build homes and expand supply. The full picture remains contested, according to WGME.
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