When it comes to housing affordability, both Vice Presidential candidates Senator J.D. Vance (R-OH) and Minnesota Governor Tim Walz acknowledge the problem.
However, the two have very different explanations for its cause and proposed solutions.
J.D. Vance’s Explanation for the Housing Affordability Crisis
GOP candidate J.D. Vance suggests skyrocketing home prices are the result of a large influx of unauthorized immigrants and by extension, the housing market. This increase in population is driving up demand and competition for Americans.
“Twenty-five million illegal aliens competing with Americans for scarce homes is one of the most significant drivers of home prices in the country. It’s why we have massive increases in home prices that have happened right alongside massive increases in illegal alien, alien populations under Kamala Harris’s leadership,” Vance said in Tuesday’s Vice Presidential debate.
In separate reports published by the Department of Homeland Security and Pew Research Center, the total estimated number of unauthorized immigrants living in the U.S. is around 11 million.
However, these figures are estimates up through 2022. But 2023’s figures are forecasted to be the highest in recent years based on other indicators, including number of encounters, and immigration-related applications and hearings.
Taking these metrics into consideration, the Center for Immigration Policies estimates that 2023 saw an uptick of between 500,000 and 700,000 in the unauthorized immigrant population, for a total of between 11.4–11.7 million.
Overall, the unauthorized immigrant population has increased by between 1.2–1.5 million since 2020. It remains lower than its 2007 peak of approximately 12.2 million.
In reality, most unauthorized immigrants do not immediately enter the country and immediately start bidding on homes. The Migration Policy Institute estimates that around 28% of immigrants are homeowners, and a majority bought their homes prior to 2007.
A Pew Research survey of undocumented immigrant homeownership rates estimates just over 4% of the total American housing supply — or about 6 million of the nation’s 130 million homes — are owned by unauthorized immigrants. In a majority of cases, the immigrant is cohabiting with a U.S. citizen.
Using these figures as a benchmark (28% homeownership rate and 1.5 million unauthorized immigrant population increase since 2020), unauthorized immigrants would have bought about 420,000 of the 21 million home sales since 2020. That amounts to approximately 2% of total home purchases.
In other words, Vance’s claim that the increase in unauthorized immigrants are adversely impacting housing affordability falls short.
Tim Walz’s Explanation for the Housing Affordability Crisis
Tim Walz, on the other hand, had this to say about housing prices:
“Look, this issue of continuing to bring this up, of not dealing with it, of blaming migrants for everything,” Walz said. “On housing, we could talk a little bit about Wall Street speculators buying up housing and making them less affordable.”
According to the U.S. Census Bureau, less than 59% of America’s 130 million homes are owner-occupied, and around 31% of homes are rented.
Investor interest in the housing market has skyrocketed since 2020. According to Federal Reserve data, 45,155,000 housing units in the U.S. were occupied by renters at the end of Q2 in 2024. That amounts to an increase of 4.4 million from Q2 of 2020.
According to a report published by the Harvard Joint Center for Housing Studies, since 2020, between 25–30% of all home sales have been to investors.
Moreover, Wall Street’s seems especially interested in buying starter homes, a critical access step for first-time homebuyers to enter the housing market and start building equity. Without this stepping stone , many would-be, first-time homebuyers may never be able to gain entry to the housing market.
Nationwide, starter home prices have skyrocketed by nearly 55% over the last 5 years, according to a July 2024 report published by Zillow. Zillow also notes that as a category, starter homes experienced the largest price surge.
Between 2019-2023, the number of U.S. cities with starter homes listed at $1 million or more nearly tripled, from 84 to 237.
Blackstone subsidiary RealPage is currently being investigated by the Department of Justice for price fixing rent. Blackstone has bought thousands of single-family and multi-family homes in recent years.
Did Walz or Vance Get It Right?
Walz, hands down.
If J.D. wants to meaningfully impact America’s housing affordability crisis, the red herring immigrant boogeyman explanation falls drastically short.
Wall Street’s increased interest in the housing market has created a surge in demand and sent prices running. That’s good news for large-scale investors with many homes in their portfolios.
But it’s daunting news for American workers shut out of an integral part of the American Dream.
Related: Single Women Outpace Men in Homeownership – But There’s More to the Story
