Trump's mass deportation plan could be 'devastating' to livelihoods
President-elect Donald Trump's plan to deal with millions of undocumented immigrants could threaten one of the few housing bright spots of the past few years: . The mass deportations will hit homebuilders and other workers in the sector with labor shortages, as immigrants have recently been found to make up about 30% of the construction workforce, and about half are undocumented.
co-founder and CEO National Association of Hispanic Real Estate Professionals () sees difficulties ahead.
“This will have a negative and possibly devastating impact on the construction workforce in markets across the United States,” Acosta said. “The construction industry has been around for a long time and it's well documented. They talk about coming to their workplaces and sweeping those markets. We know that this will affect the workforce of people on the margins, perhaps in the process of getting their status formally.
Rising new home sales outpaced existing home sales as builders were able to lower prices to entice buyers – an important factor in an increasingly buoyant housing market. A significant shift in the workforce can increase this advantage.
Acosta said the fear of mass deportations will make it harder for construction companies to hire new workers when new jobs become available. And Acosta says it doesn't stop at the housing and construction industry.
“It's going to be the restaurant industry, the hospitality industry…I think unfortunately immigration is framed as a social policy issue and very emotionally, with people talking about crime and murders and all these supposed things. created immigration, I think a lot of that is a lie in my opinion,” he shared. “People don't see it as an economic issue. They see it as a matter of social policy. And if they look at it purely from an economic point of view, I think their opinion will be different.”
Acosta says he looked at it from a mathematical point of view – “Math has no idea,” he quips. In a context of low housing inventories and already low unemployment, mass deportations will make matters worse.
“It will take years, if not decades, to retrain our workforce for these (job) gaps. There are currently approximately 11 million unfilled jobs in the United States, and the only way to fill those jobs is through smart immigration. It's not going to happen with new births, it's not going to happen because people are sitting on the sidelines. “We are in a deficit in terms of manpower and increasing this deficit is not the right solution.”
Stephen Kim, senior managing director and head of the investment firm's Housing Research Group Evercore ISIspeaks regularly to homebuilders and says that by 2025, “there's no doubt in anyone's mind that it will be a significant factor in housing production.”
Kim added that while contractors sometimes have to ensure that everyone on their team is a documented citizen, no one he spoke with is confident that there aren't illegal immigrants finding their way into those jobs. “Also, everyone I've talked to believes there is a meaningful number of undocumented workers in the industry — not like 1 or 2%, but a meaningful number. “Maybe they're not working at home, but they're there and they're working on something.”
At the same time, large-scale deportations will not have much impact on housing demand, Kim says. “Immigrants tend to live in large households, and it's households that take up the housing stock… I don't want to sound too dismissive here, but if you had a family of seven and two of them were deported, you would. there are still five people who need to live somewhere,” he said.
But Kim acknowledged that it all depends on what happens after Trump is in office, meaning he has no concrete plans to back off from his current construction efforts or be more cautious.
“If you see the authorities going to a construction site or building a house and actually rounding up immigrants, I believe the word will spread pretty quickly and you'll see a lot of workers being very careful about coming to work the next time. day,” Kim said. “I don't think you're going to see people just go online and quit and never come back. I think they have to work, but they're going to be really careful … there might be a period of time where you're not there.. . it will, however, cause delays.”
Mass deportations will hit housing harder in some states than others. It recently noted that more than half a million immigrants work in the construction industry in 2022, a hot spot for homebuilding, and about 60% of that workforce is undocumented, more than double the national number. Unfortunately, Texas state officials own 1,400 acres of state land to house a new deportation facility if Trump so chooses.
