14 Of 20 Major US Cities See Home Prices Drop—White House Says Deportations To Thank

The Trump administration’s assertion that mass deportations are directly reducing housing costs in major U.S. metropolitan areas has ignited debate between officials pointing to recent price declines and economists warning of broader inflationary consequences.

In a statement released in January 2026, the White House claimed that median home list prices have fallen in 14 of the 20 metropolitan areas with the largest undocumented populations, declaring “mass deportations = lower housing costs”. The administration highlighted year-over-year declines of approximately 7.3% in Austin, 6.7% in San Diego, and 4.3% in Miami as evidence that enforcement efforts are delivering relief to American homeowners.

Administration Claims Two Million Removals

Officials cite an estimated two million people who have either been deported or self-deported since enforcement intensified in 2025 as proof of the strategy’s effectiveness. “The numbers don’t lie: 2 million illegal aliens have been removed or self-deported in just 250 days—proving that President Trump’s policies and Secretary Noem’s leadership are working and making American communities safe,” Assistant Secretary Tricia McLaughlin stated in September 2025.

The administration argues that by reducing competition for housing and public services, enforcement is delivering immediate financial benefits to citizens struggling with affordability. The White House messaging also notes that the three metros in its sample where list prices rose modestly are all sanctuary cities that limit cooperation with federal immigration enforcement.

Economists Warn of Supply-Side Inflation

Many economists dispute the simple causal relationship between deportations and lower prices, cautioning that large-scale removals reduce the labor force and may push overall inflation higher. Mark Zandi, chief economist at Moody’s, told Fortune that ongoing deportations could drive U.S. inflation from 2.5% toward 4% by early 2026 as the foreign-born labor force declines and overall labor force growth stalls.

“Foreign-born labor force is declining, and the overall labor force has gone flat since the beginning of the year,” Zandi explained. “That’s causing tightening in a lot of markets, adding to costs and inflation”. He emphasized that immigration-driven inflation represents a supply-side shock that interest rate changes cannot easily fix, warning that “rate cuts won’t bring more immigrants into the country”.

Housing Specialists Point to Complexity

Housing researchers emphasize that home prices are driven primarily by interest rates, construction capacity, and long-running supply shortages rather than population changes alone. Bishop Chappell, an Austin-based real estate agent, noted that recent price declines in that city began following peak prices in 2022, well before intensified deportation efforts. “Interest rates are probably the biggest mover of price drivers,” Chappell observed.

Troup Howard, assistant professor at the University of Utah’s David Eccles School of Business, whose research examines immigration policy’s impact on housing markets, stated: “Our research suggests that the net effect of immigration enforcement is to reduce homebuilding. In turn, this increases prices for newly constructed homes”.​

Construction Labor Force at Risk

Researchers stress that immigrants contribute not only to housing demand but also to housing supply, making up more than 23% of the construction workforce in 2023, with an estimated half being undocumented. The Urban Institute warned that mass deportations would worsen the nation’s existing 3.7 million-unit housing shortage by removing essential construction workers.

Studies of the Secure Communities program during the 2000s, which led to deportations of more than 454,000 people between 2008 and 2014, found that increased enforcement reduced construction employment for both immigrant and U.S.-born workers, delayed homebuilding, and in some cases increased housing costs. Research by Howard and colleagues showed that the program’s immigration enforcement had large negative effects on construction employment, with undocumented labor complementing rather than substituting for domestic workers.

Labor Shortages Already Emerging

Early data show foreign-born labor force participation flattening or declining in several industries heavily reliant on immigrant workers, including construction, agriculture, manufacturing, hospitality, and elder care. The Baker Institute projected that mass deportations could reduce the construction workforce by 1.5 million workers, with states like Texas and California—where immigrants make up 37% to 39% of construction workers—facing the most acute impacts.

Industry groups report that 248,000 construction jobs remained unfilled as of mid-2025, with the sector expected to need nearly 454,000 new workers on top of normal hiring to meet demand in 2025. Economists warn that as deportation effects fully materialize, employers may face more acute labor shortages, pushing wages and production costs higher and feeding into consumer prices.

Competing Explanations for Price Declines

While the White House continues to present the correlation between falling list prices and deportation activity as evidence of direct causation, critics argue that recent price softening reflects cooling demand after pandemic spikes, higher mortgage rates, and broader economic shifts that would have occurred regardless of deportation numbers. Vaike O’Grady, research adviser at Unlock MLS, described Austin’s market shifts as “part of a broader trend of normalization—not a sudden drop or the result of any one factor”.

Analysts also highlight that housing markets are highly local, with some regions still struggling with severe undersupply while others cool faster. The dispute over what is driving recent price shifts is likely to intensify as more housing and inflation data emerge in 2026, with supporters viewing mass deportations as a necessary correction that prioritizes citizens while critics warn of long-term risks to growth, affordability, and community stability if labor and housing markets remain out of balance.