A recent working paper released by two economists working for the Federal Reserve Bank of Dallas has suggested that illegal migration over the Biden years contributed to as much as a 20% growth in recent years and a whopping 30% increase in housing prices over the last five years.
The paper, titled “The Impacts of Unauthorized Immigration on U.S. Labor and Housing Markets: New Evidence from Administrative Microdata,” provides strong evidence to support the claim that illegal migration has not only worsened an affordability crisis in America, but is one of its key drivers.
For years, America has faced a chronic shortage of housing, a problem that is most acute in metropolitan areas where the number of new homes being built has severely lagged the skyrocketing demand.
In the years Biden occupied the Oval Office, hordes of illegals – to the tune of, at least, 15 million – entered the homeland. This placed severe pressure on an already tight and inelastic housing market.
The paper concluded that every 1% addition of illegal aliens to a local area’s initial employment raised rents in that area by 1.4%, while increasing housing prices by 2.2%.
In certain key metro areas, such as Houston, Miami, New York, and Minneapolis, where the concentration of illegal migrant inflows was disproportionate to the national average, those housing markets would experience an especially pronounced uptick.
The result of this distressing trend was that ordinary Americans, particularly new homebuyers and young people, were literally being squeezed out of housing altogether because of the seismic pressures introduced by illegal aliens.
In past generations, Americans would only have to compete among themselves for housing. Housing followed a typical supply and demand relationship – where greater demand was often manageable because new housing could be easily built, without encumbering supply chains too much.
In recent years, that logic has been totally upended. First, loose monetary policy has expanded the money supply. The effect of quantitative easing has driven up housing prices far beyond the demand.
The inflation this caused has been exacerbated further by a restricted housing supply, which has been slow to rebound since the COVID-19 pandemic devastated supply chains nationwide.
This in turn further worsened a problem that had been ongoing for years due to burdensome regulations, red-tape, and excess bureaucracy in the housing market.
The effect of opening America’s borders and letting in the third world during an already unmanageable housing crisis was like adding gasoline to the fire.
The market effects have been catastrophic: new home buyers have been potentially delayed from purchasing their first home by decades. Many have been forced out of the market entirely.
The problems arising from illegal aliens do not just stop at the supply and demand curve: more people cause more strains on local infrastructure, resulting in setbacks and unintended deterioration of said supply.
Local and state governments, rather than allocating limited resources to build new housing, must now reallocate precious time, money, and manpower to improving the infrastructure already available.
This has the double effect of reducing the resources available for new housing while contributing more delays to a market grossly in short supply already.
Hellbound and Down 