A new Federal Reserve Bank of Dallas working paper is adding to the national housing affordability debate by estimating how much recent immigration affected rents and home prices. The paper focuses on the 2021 to 2024 surge in unauthorized immigration during the Biden administration and concludes that the added demand contributed to higher shelter costs in markets with limited short-term housing supply.
Dallas Fed paper quantified housing effects during the 2021-2024 surge
The Federal Reserve Bank of Dallas released Working Paper No. 2607 on March 23, 2026, and the study examined what it called an “unprecedented boom” in unauthorized immigration from early 2021 to early 2024. According to the paper by economists Daniel J. Wilson and Xiaoqing Zhou, unauthorized immigrant worker flows increased local employment roughly one-for-one and also pushed up housing costs. The researchers said those inflows raised local house prices and rents without producing a significant expansion in housing supply over the same period.
The paper’s headline estimate was specific. It found that an increase in unauthorized immigrant worker flows equal to 1% of a local area’s initial employment raised local house prices by 2.2% and rents by 1.4%. The authors also wrote that, for the average local market, those flows could explain about 30% of total house-price growth and 20% of total rent growth during the March 2021 to March 2024 boom period.
The researchers said the effect operated mainly as a demand shock. Their housing-supply estimates, based on new permit activity relative to existing housing stock, were small and statistically insignificant across single-family and multifamily categories. That meant prices rose faster than construction responded, at least in the short run measured by the study.
The Dallas Fed analysis was national in scope, but it used local labor and housing market data across commuting zones and metropolitan statistical areas. The paper said the largest immigrant worker inflows during the boom period were concentrated in parts of the West, the southern belt including Arizona, Texas and Florida, and the Northeast around the New York City metropolitan area. Those are broad regional findings rather than a full accounting of how much any one state’s median rent or sale price changed.
For readers looking for a state-by-state bottom line, that is not yet available from this paper. The authors did not release a comprehensive table showing a separate home-price or rent increase for every state. Instead, the paper reports average local-market effects and maps the intensity of inflows across local areas.
That distinction matters because housing markets vary widely. A metro with tight zoning, low vacancy and limited near-term construction capacity may respond differently than a market where multifamily construction can ramp up more quickly. The paper measures a national pattern from local data, but it does not say that every city or state experienced the same degree of price pressure.
The Dallas Fed authors tied the housing effect to a basic imbalance: more households competing for shelter in places where supply was slow to respond. Their findings were consistent with what the Congressional Budget Office has also said about the broader immigration surge, including that greater demand for residential investment and housing can affect local budgets and property-tax receipts. The CBO estimated that the recent surge involved an additional 8.7 million people from 2021 to 2026 in its “other-foreign-national” category, though that estimate covers a wider population than the Dallas Fed paper’s unauthorized-worker measure.
Other housing researchers have urged caution about treating immigration as the main driver of the affordability crisis. The Joint Center for Housing Studies at Harvard said in an October 2024 analysis that the big spike in home prices and rents began earlier in the pandemic, before the largest jump in immigration, and pointed instead to millennial household formation, remote-work demand, low mortgage rates and years of underbuilding.
For residents, the practical takeaway is narrower than the political rhetoric around the study. The paper does not say immigration alone caused the housing crisis, but it does say recent unauthorized worker inflows added measurable demand in already constrained markets. It also suggests that without faster housing production, any sudden increase in households can put added pressure on rents and sale prices.