Abstract

This study examines the actual impact of unauthorized immigration on housing rental markets, contrasting popular rhetoric with empirical evidence. We provide evidence from comprehensive data analysis on how unauthorized immigration influences housing rents.

The Backstory

After the first paper (“Beyond the Hype”) was published, we received a fair question from readers and reviewers: You showed unauthorized immigrants don’t drive up home prices but what about rents? After all, most unauthorized immigrants don’t own homes. They rent. If there was any market where their presence would show up, it would be in the rental market.

It was a reasonable challenge. So we went back to the data. Using the same state-level panel framework covering, we tested whether growth in the unauthorized immigrant population was associated with rising average or median rents. The answer was the same. Our findings consistently revealed no statistically significant relationship between unauthorized immigration and housing rent growth.

But we want to be candid about what this study can and cannot tell us. The most significant constraint is data granularity. We rely on state-level estimates of unauthorized immigrant populations, and that’s a real limitation. Housing markets don’t operate at the state level. They operate at the city, neighborhood, and even zip code level. A state like Texas or California contains dozens of distinct housing markets moving in completely different directions at any given time. By working at the state level, we almost certainly smooth over local dynamics that could tell a richer, more nuanced story.

Ideally, we would want county- or metro-level data on unauthorized immigrant concentrations — but that data simply doesn’t exist in a reliable, systematic form. Unauthorized immigrants are, by definition, a population that is difficult to count, and the best available estimates are aggregated at the state level. We worked with the best data available, but we acknowledge it comes at a cost.

There’s also the question of informal housing markets. Our rent measures capture formal market transactions. But a meaningful share of unauthorized immigrants live outside that formal market entirely in arrangements that never show up in Zillow data or the American Community Survey. If we had better visibility into informal housing, we might be able to say something more precise about how this population experiences housing costs, even if our core finding holds.

These aren’t reasons to dismiss the findings. But they are honest reasons to keep pushing for better, more granular data. The question deserves it.

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