Decreasing Immigration Could Destroy the Housing Market
- The 2024 presidential election highlighted significant housing market issues as voters dealt with surging home prices and low inventory.
- Realtor.com analyzed President-elect Donald Trump's housing policies and noted potential benefits from reduced regulations but warned of the risks associated with decreased immigration.
- Overall, the housing market's recovery could be jeopardized by labor shortages and increased material costs resulting from proposed policies.
In the wake of the 2024 presidential election, housing market issues surged to the forefront as voters grappled with high home prices driven by low inventory. President-elect Donald Trump's victory has prompted a reevaluation of policies surrounding the housing market, particularly concerning his promises to reduce regulations to boost housing supply. However, a report from Realtor.com warns that potential changes to immigration policy could exacerbate labor shortages in construction and hinder housing demand over time. With a significant portion of the residential construction workforce being foreign-born, cutting immigration rates could significantly impact the labor supply necessary for home building. The report also highlighted that escalating tariffs on imported materials could drive up home construction costs, further complicating affordability for buyers and potentially stymieing any positive impacts from Trump's proposed policy changes. As the housing market faces a prolonged affordability crisis, the effectiveness of proposed measures will be scrutinized as they unfold under the new administration.