Impact of Mass Deportations on Rent in Sun Belt Cities
The Department of Homeland Security (DHS) claims that mass deportations during the Trump administration have reduced rents in several Sun Belt cities. The department’s social media post highlights a correlation between deportations and rent reductions in cities such as Austin, Nashville, and Phoenix.
Reported Rent Reductions
In July, Texas accounted for about a quarter of ICE arrests, with San Antonio rents dropping 4.8%, Austin 4.3%, and Dallas and Houston around 3%. Other notable decreases included Miami at 2.6%, Phoenix at 4.2%, Atlanta at 3.2%, Nashville at 5.3%, and New Orleans at 8%. However, DHS did not specify the source or methodology behind these figures, causing skepticism due to discrepancies with major rental indexes.
Possible Influences on Housing Prices
The department referenced unspecified research suggesting that illegal-worker inflows increase rents and home prices. The supposed reversal of this trend is partly credited to stringent interior enforcement in certain states. This claim aligns with a working paper by economists Daniel J. Wilson and Xiaoqing Zhou; however, it has faced criticism from housing experts over its methodology.
Other Factors at Play
Though the DHS attributed lower rents to immigration enforcement, several cities were already witnessing a substantial price correction. This shift largely results from a construction boom that increased apartment and multifamily housing supply. For example, Texas cities like Austin, Dallas, Houston, and San Antonio have seen extensive apartment development, ranking them among top cities for new apartments according to RentCafe’s 2025 study. Additionally, cities such as Phoenix, Atlanta, and Miami showed similar trends.
This influx of new housing, secured amid a population surge, entered the market as demand waned. Factors like the return-to-office mandates on the coasts and increased building competition contributed to the price adjustments.
The average rent data from Zillow shows declines across these metros. In Austin, the average rent is now $1,990, down by $10 from last year. In New Orleans, rents dropped by a notable $100 year-over-year to $1,650.
Costs and Workforce Concerns
President Donald Trump had campaigned on lowering housing costs via mass deportations. Since January 2025, over 605,000 illegal aliens have been deported, with 1.9 million self-deportations reportedly triggered. Critics question the potential benefits of this policy on housing costs.
From a market standpoint, deportations might free up housing. However, they may also impact the construction industry, which heavily relies on undocumented labor. Approximately 1.6 million undocumented immigrants participate in construction work. The Urban Institute noted that immigrants made up over 23% of U.S. construction workers in 2023. Daryl Fairweather of Redfin suggested that reduced labor supply might increase building costs and slow housing production.
The National Association of Home Builders and other experts warn that fewer workers could delay projects and elevate labor costs, ultimately affecting home prices. Instances like a $20 million project delay near Mobile, Alabama, illustrate potential complications following ICE raids.