For starters this is not a political pitch, but a theoretical take on what could happen over the next few years per Trump’s ICE director pick, Tom Homan, and his goals as ICE director.
The effect on rental demand could be significant over the next few years. Illegal immigrants are largely renters due to financing requirements of conventional loans (Social security and credit checks for starters) and it is very difficult to come up with full cash purchases. If millions of renters were removed from the housing market, demand for rental units would likely decrease, potentially reversing the current trend of rising occupancy. Markets with high immigrant populations might see the largest impact.
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This shift could influence rental rates and market stability. Lower occupancy could lead to stagnating or even dropping rental prices in certain regions, impacting investors’ returns and potentially creating a buyer’s market for those looking to acquire rental properties.
These changes will be highly geographically varied, with regions that have higher illegal immigrant renter populations experiencing different occupancy trends compared to areas with fewer immigrant residents. This could create a patchwork effect on apartment demand across the U.S.
For investors, especially in immigrant-dense regions, these changes could mean shifts in cap rates and vacancy rates. Property owners might need to reevaluate leasing strategies or consider incentives to keep occupancy levels stable and definitely factor this in on investment purchases over the near future.
Overall, investors and renters alike may need to be prepared for the potential ripple effects on the rental housing market, depending on how such policies play out across the country.
Read the Original Article Here: America’s Empty Apartments Are Filling Up