Donald Trump's presidential campaign has proposed deporting millions of immigrants, in part to solve the nation’s persistent housing shortage. However, research shows that would expel many people who are building homes and could worsen the problem.

Trump’s campaign promise of “mass deportations” and its connection to housing has been repeated across the campaign trail by the former president and his running mate, JD Vance. It took the spotlight at the vice presidential debate when Vance blamed immigrants for, among other things, the surge in home prices since the pandemic hit.

“You have got housing that is totally unaffordable because we brought in millions of illegal immigrants to compete with Americans fo🃏r scarce homes,” Vance said.

Indeed, home prices have gone up more than 50% since the pandemic hit, according to the S&P Case-Shiller Home Price Index. Hourly wages have risen 23% over the same period, meaning purchasing a home has become much less affo🍌rdable.

Ever since the Great Recession, the population has grown faster than the housing stock, creating what Moody's Analytics estimates is a 2.9 million home shortage. Without enough homes to satisfy demand, 澳洲幸运5官方开奖结果体彩网:home prices have soared.

The High Price Of Deportations

But would expelling illegal imm💛igrants, as Trump and Vꦗance propose, help matters?

Studies have linked immigration with increases in rents. A 2017 analysis published in the Journal of Housing Economics found that areas with immigration equal to 1% of their population saw home prices and rents rise 0.8%, with higher increases in home prices in surrounding areas.

However, recent research suggests that removing immigrants could actually worsen the housing affordability problem in the long run. A study published in March by Troup Howard, a professor of finance at the University of Utah, and researchers Mengqi Wang and Dayin Zhang of the University of Wisconsin, looked at what happened between 2008 and 2013 when a federal program deported 300,000 undocumented immigrants.

Because the deportation campaign rolled out in different places across the country at d💖ifferent times, the researchers could examine what happened to home prices in counties that had 🎉deportations versus those that didn’t.

It turned out that many of the people who got deported were working in the home building industry. When undocumented immigrants left, there weren’t enough workers to take their place. As a result, the industry, and in turn homebuyers, paid the price.

Three years after the deportations, the average county had built 1,997 fewer homes, the equivalent of losing an entire year’s worth of homebuilding, the study found. The researchers found that new construction parcels were $57,300 more expensive than they otherwise would have been, an increase of 17%.

Industry Relies On Immigrant Labor

The heavy impact on the homebuilding industry was unsurprising giveꦑn the demogౠraphics of the workforce.

As of 2022, about a third of all workers in home construction were foreign-born, according to an analysis of Census data by the National Association of Home Builders. Among some construction trades, the figures were even higher, with immigrants making up 64% of drywall and stucco installers, for example.

The homebuilding industry relies heavily on both legal and illegal immigrants, Jim Tobin, CEO of the National Association of Home Builders, told Investopedia in an interview. 

“We have got to increase the supply of American-born workers, but until we do that, the demand in our industry is so high that we rely to a large extent on immigrant labor,” Tobin said. “Anytime you're talking about mass deportations, you risk disrupting the labor force in our industry or any industry that is relying on immigrant labor.”

The reไduction in the workforce would raise labor costs, which wou𒐪ld be passed on to buyers, Tobin said.

Many More Homes Need to be Built

Experts say that if housing is g⛄oing to become more affordable, the U.S. will simply have to build a lot more homes. T🏅hey blame local zoning regulations that restrict construction for much of the housing shortfall. 

"There is pretty strong consensus among housing economists that the primary structural problem in the U.S. housing market stems from a very long period of underbuilding homes in this country due to unnecessarily strict land use regulations,” Ralph McLaughlin, senior economist at Realtor.com wrote in an email.

“While a band-aid solution would be to reduce aggregate demand for homes, getting to the root of the problem involves sorting out supply-side issues instead,” he said.