Impact of Deportations on Rent in Sun Belt Cities

The Department of Homeland Security (DHS) has indicated that mass deportations by the Trump administration are contributing to lower rental costs in several Sun Belt cities. Cities such as Austin, Nashville, and Phoenix have reportedly experienced rent reductions. A social media post on X from the department stated, “DHS is reducing your rent, especially in states that cooperate with [Immigration and Customs Enforcement] ICE.” The post highlighted that Texas, which accounted for approximately a quarter of ICE arrests in July, showed the sharpest rent declines. In particular, San Antonio saw rents decrease by 4.8%, Austin by 4.3%, and cities like Dallas and Houston about 3%. Miami experienced a 2.6% reduction, Phoenix 4.2%, Atlanta 3.2%, Nashville 5.3%, and New Orleans 8%.

However, DHS did not disclose the origins or methodologies used for these rent figures. These percentages do not align with major rental indexes available publicly. Unspecified “research” mentioned by the department claims that influxes of illegal workers elevate rents and home prices, and that reversing this inflow is occurring in states enforcing stringent interior policies.

The department referred to a working paper by economists Daniel J. Wilson from the San Francisco Fed and Xiaoqing Zhou from the Dallas Fed, which suggested that surges in undocumented immigration under President Joe Biden inflated U.S. housing costs. Other housing experts and economists have criticized these conclusions, citing flaws such as ignoring domestic migration impacts on home price increases.

DHS expressed in its social media post, “Want lower cost of living: support mass deportations.” The administration aimed to reveal a link between states cooperating with ICE agents and reduced rent, although the cities mentioned were already undergoing price corrections due to increased apartment and multifamily construction efforts.

A Supply Boom Outpaced Demand

Texas metros are noted for constructing more new apartments and multifamily housing in response to domestic migration since the pandemic. Austin, Dallas, Houston, and San Antonio have been included in a RentCafe study listing the top cities for new apartment construction last year. Dallas and Austin ranked second and third after New York City, with 28,958 and 26,715 new units expected by year-end, respectively. Phoenix ranked fourth with 21,188 units, Atlanta fifth with 17,512. Miami was seventh with 15,666 units, while Nashville ranked 14th with 9,810 units. New Orleans, however, did not feature in the top 20.

Many units approved during population surges flooded the market when demand diminished due to higher prices and employers’ return-to-office policies. As a result, landlord competition intensifies with reduced renter pools, causing rental prices to drop.

Austin’s average rent is currently $1,990, down $10 from last year. Dallas stands at $1,950, falling $45. Houston remains unchanged at $1,900. San Antonio saw rent fall by $80 year-over-year. Miami’s rent is $3,150, down $10. In Phoenix, rent dropped by $70 to $1,825. Atlanta’s average rent is $2,100, unchanged. Nashville’s rent fell $50 to $2,200, and New Orleans observed a significant $100 drop to $1,650, according to Zillow.

Although DHS did not provide metro-level figures, nor allocated specific rent decline percentages to immigration enforcement, several metros not mentioned, like Las Vegas and San Diego, also experienced rent reductions due to new housing oversupply. Nationally, median asking rents for studios through two-bedroom homes fell year-over-year in the largest 50 U.S. metro areas for the 37th consecutive month in August, driven chiefly by new apartment influxes and moderated rental demand, mainly in the South and West.

Can Mass Deportations Lower Rent?

President Trump’s campaign promised housing cost reductions through mass deportations of undocumented immigrants. Yet experts question whether this method offers the promised benefits.

According to the White House, since January 2025, the Trump administration deported over 605,000 undocumented individuals, prompting an additional 1.9 million self-deportations. From a housing-market perspective, large-scale deportations might “help free up some housing,” as noted by Redfin’s chief economist Daryl Fairweather.

Benefits from mass deportations might be negated by the adverse conditions imposed on the homebuilding workforce. Reports reveal nearly 1.6 million undocumented immigrants work in the U.S. construction industry. The Urban Institute noted immigrants made up over 23% of U.S. construction employees in 2023, half being undocumented.

Fairweather warns that reducing labor supply might increase building costs and slow new home production. Danielle Hale of Realtor.com previously highlighted that limiting immigration might “make it more difficult for companies to hire workers in the near-term,” affecting construction sectors significantly.

The National Association of Home Builders (NAHB) argued that fewer workers cause construction delays and increase labor expenses, potentially elevating home prices. A July 2025 Reuters investigation reported a $20 million recreation center project in Mobile, Alabama, faced delays after an ICE raid in Florida. The project’s superintendent noted a 50% workforce reduction with workers fearing similar raids. Reuters’ interviews with construction experts revealed similar experiences of delays, additional costs, and worsening labor shortages.

Newsweek has contacted DHS for comments regarding these findings.