Trump’s mass deportations would equal bad news for housing


Millions of people – gone. Just like that. Regardless of your views on illegal immigration, a massive deportation on the scale that President-elect Donald Trump speaks about will have consequences for the economy.

Trump repeatedly spoke during his campaign trails about deporting all illegal immigrants. Now, he changed his tone, focusing on the two to three million illegal immigrants with illegal records.

In fact, even his website changed in regards to its immigration focus. Now, instead of telling stories of illegal immigrants who were rapists and the lives they destroyed, which is what it said before, it simply puts down his plan and outlines what he will focus on as president.

Still, 2 to 3 million people is no small amount to remove from the economy, and could have disastrous consequences. Since the election, Trump’s focus has been on those who have a criminal history, he never said he wouldn’t deport others.

From his website:

All immigration laws will be enforced – we will triple the number of ICE agents. Anyone who enters the U.S. illegally is subject to deportation. That is what it means to have laws and to have a country.

A mass deportation of this kind could greatly increase the foreclosure rate, at a time when it was just getting back to pre-crisis levels.

During the housing crisis, Hispanics had a higher foreclosure rate than any other race, partially due to the sudden increase in deportation, more than 3 million undocumented immigrants, from 2005 and 2013, according to an article by Emily Badger for The New York Times.

A study from Migration Policy Institute, Pew Research Center, Warren and Warren and Goldman Sachs Global Investment Research shows that during those years illegal immigration stopped and even reversed as more left the country that came in during some years.

From the NYT article:

New research now suggests that the deportations helped exacerbate foreclosures. Counties that collaborated with ICE in what became a large-scale deportation sweep experienced a surge in foreclosures of homes owned by Hispanics, according to a study by Jacob Rugh and Matthew Hall published Thursday in the journal Sociological Science. They argue that the roundups help explain why Hispanics faced the highest foreclosure rates during the housing crash — even among households with legal residents and American citizens.

Actually, it makes sense. About 85% of those deported were working males. Taking them out of the picture would cause the rest of the household to struggle to make mortgage payments.

From the article:

Such sizable effects are possible because of an often-overlooked dynamic in Hispanic households: Many undocumented immigrants live in — and contribute income to — households with legal residents. In those 42 counties [counties that signed on to the 287(g) program from 2005 to 2012], for example, the researchers estimate that nearly three-quarters of the 1.2 million households with at least one undocumented adult immigrant also contained a documented adult household member. And about a third of all undocumented immigrants in those counties lived in owner-occupied homes.

But foreclosures aren’t the only area that would be affected. The construction sector shows the second-highest number of undocumented workers at 1.1 million.

While I am not making a case for or against undocumented workers being allowed to stay in the country, as with all major economic decisions, this is a policy that should be considered carefully, with attention placed in all possible outcomes and consequences of the actions taken.

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