A Federal Reserve Bank of Dallas working paper is drawing renewed attention after U.S. Rep. Beth Van Duyne (R-Texas) highlighted its finding that illegal immigration accounted for nearly 30% of home-price growth and about 20% of rent growth in the average metropolitan market from March 2021 to March 2024.
The researchers also estimated that the surge accounted for roughly 30% of employment growth in the average local labor market during the same period.
The Dallas Fed published the paper on March 23. Van Duyne’s recent CBS News Texas interview brought renewed attention to the findings. Daniel J. Wilson of the Federal Reserve Bank of San Francisco and Xiaoqing Zhou of the Dallas Fed authored the study.
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The authors described the document as a preliminary working paper and said its conclusions do not necessarily reflect the views of the Dallas Fed, the San Francisco Fed or the Federal Reserve System.
Van Duyne points to the financial consequences
“We’ve actually been saying this for a number of months now,” Van Duyne said during the CBS News Texas interview. She argued that many Americans do not understand the consequences of allowing millions of people to enter the country illegally over a short period.
The paper lends empirical support to concerns Van Duyne said she has raised for months, particularly about the pressure a rapid population increase can place on housing markets that cannot add homes quickly enough.
What the 30% and 20% figures mean
The findings do not mean illegal immigration caused home prices to rise by 30% or rents to rise by 20%. Instead, the researchers estimated that illegal immigrant worker inflows explained those shares of the total growth recorded in the average metropolitan market during the three-year period.
For the average metropolitan area, the authors calculated that the inflows pushed home prices about 6.6% higher, accounting for roughly 30% of the 22.4% total increase. They estimated that the inflows pushed rents 4.3% higher, accounting for about 20% of total rent growth.
The authors cited a Congressional Budget Office estimate that net entry in the paper’s unauthorized immigration category added roughly 7 million people to the U.S. population from 2021 through 2024, nearly twice the level of legal immigration.
The study period also included pandemic-era disruptions and other forces that affected housing. The researchers used differences in illegal immigrant worker inflows across local markets to estimate the effect of the surge.
Housing supply did not keep pace
The researchers used immigration court records and other administrative data to estimate employed illegal immigrant flows across metropolitan areas and commuting zones. They found that an inflow equal to 1% of a local area’s initial employment increased home prices by about 2.2% and rents by about 1.4%.
The study found little evidence that local housing construction expanded enough to absorb the added demand. The authors concluded that the worker influx acted as a housing demand shock in markets with relatively fixed short-term supply.
Labor market results show tradeoffs
The paper found that the worker inflows increased local employment approximately one-for-one without causing a statistically significant decline in average local wages. The authors also found lower labor income per capita, which they attributed to the lower average earnings of newly arrived workers, and lower government transfers in the affected markets.
The results therefore present a mixed economic picture: a larger workforce and more employment, paired with higher housing costs where construction failed to keep pace with demand.
Findings build on prior DX coverage
As previously reported by The Dallas Express, a May 2025 investigation examined how rapid immigration could place additional pressure on Texas home prices and rents, particularly in markets with large immigrant populations and limited housing supply. That report focused on the burden rising rents place on lower- and middle-income residents in Dallas and other high-growth markets.
The Dallas Fed paper adds a new local-market analysis to that debate. It does not claim illegal immigration caused all housing inflation, but it estimates that the surge played a substantial role in the average metropolitan market during the period researchers studied.
Provided by Dallas Express
