How Mass Immigration Drove Up Housing Costs

Between 1990 and 2025, the United States added about 32 million foreign-born residents.^[4] The foreign-born share of the population doubled, from 7.9% to 15.8% as of January 2025, the highest ever recorded. Immigrants and their U.S.-born children together now exceed 93 million people, about 28% of the country.^[5]

Those new residents push on rent and home prices alike. In San Jose, a median home costs more than nine times the median household income, among the highest ratios in the country.^[10] More than 41% of the metro's residents were born abroad, competing for the same homes and apartments. The pattern repeats across the country. The metros that took in the most immigrants after 1990 are the ones where a home moved out of reach. The metros that took in the fewest stayed affordable.

The crisis is localized

The affordability collapse that fills national headlines is concentrated in a short list of large metros, where huge population increases have occurred. Rent burdens and housing shortages exist across the country, but the specific break between what a home costs and what a local family earns sits in those metros.

About 64% of the foreign-born live in just 20 metropolitan areas.^[14] New York holds 13% of all U.S. immigrants. Los Angeles holds 9% and Miami holds 6%. Those three metros alone hold more than a quarter of everyone in the country who was born abroad. The arrivals did not spread across the map. They landed in a short list of cities, and in those cities housing demand outran supply.

The chart below ranks each metro by its share of the entire foreign-born population. New York's bar is larger than any state's rural interior. The twenty metros at the top hold 64% of the nation's immigrants; the other thousands of counties, towns, and small cities across the country hold the remaining 36% between them.

The growth followed the same lines. The 20 metros that drew the most immigrants grew 48% between 1990 and 2025. The 20 that drew the fewest grew 23%. The first group added 38 million residents over those 35 years. The second added 6.7 million.

The slow-growing metros were not small towns. Detroit held 4.2 million people in 1990, Cleveland 2.2 million, St. Louis 2.6 million, Pittsburgh 2.6 million. Each grew at roughly 0.6% a year, and their housing stayed within reach of local wages. That pace was once ordinary. Through the decades of restricted immigration from the 1920s to the 1960s, American cities grew at about that rate as a matter of course, and homes stayed affordable. The immigration magnets are the departure. They grew at about 1.1% a year, and their prices pulled away from local wages.

Prices climb with the foreign-born share

The chart below plots every metropolitan area with more than 500,000 people, 109 of them. Each dot is one metro. Its position from left to right is the share of residents born abroad. Its height is the price of a median home divided by the median household income earned in that same metro. The income figure is local, measured city by city, so a metro with high wages is judged against its own high wages. A dot at 6x marks a place where a typical home costs six years of a typical local income.

Measuring against local income matters here. Immigrant-heavy metros tend to pay more, and a software engineer in San Jose out-earns a machinist in Pittsburgh. If home prices simply tracked those higher wages, the ratio would stay flat as the foreign-born share rose. Instead the dots climb steadily from left to right, which means homes cost more relative to what local families actually earn, not just more in raw dollars.

The 60 metros above 10% foreign-born average a home price-to-income ratio of 5.2x.^[10] The 45 between 5 and 10% average 4.0x, and the 4 under 5% average 3.2x.

The 10% figure marks where these groups split, not a threshold at which something changes. The relationship is a gradient across the whole range rather than a cliff, and the bottom tier still holds only four metros.

Across all 109 metros the correlation between a metro's foreign-born share and its home price-to-income ratio is 0.69. Restricting the sample to the 55 metros over a million raises it to 0.77, and the wider sample is reported here because a threshold chosen after seeing which one produces the larger number is not a finding.

Pittsburgh, at 4.6% foreign-born, is among the most affordable large markets on this measure, at 2.98x income.^[11] Toledo, at 4.4%, sits at 2.95x. In Miami, where 43.6% of residents were born abroad, a family needs more than six years of income to buy a median home.

Immigrants also choose destinations partly because those metros are booming, which means a scatter plot alone cannot separate the two. Albert Saiz, an economist at MIT, addressed that problem directly by predicting each city's immigrant inflow from where earlier arrivals from the same countries had already settled, a pattern set decades before current housing conditions. Measured that way, an inflow equal to 1% of a city's population raises rents by about 1%.^[3]

It is supply and demand

None of this is unique to immigration. A home costs more when the number of people bidding for it grows faster than the number of homes, whoever those people are. The clearest proof is a city that took in almost no immigrants and got expensive anyway.

Boise, Idaho is about 7% foreign-born, half the national rate.^[17] Its housing came apart regardless. Between 2019 and 2022 the median home price rose about two-thirds, from roughly $300,000 to roughly $500,000, one of the steepest climbs of any metro in the country.^[18] The ratio of home price to local income went from about four to nearly six, the range of Los Angeles and Miami.^[18] The buyers were Americans. Nine of the ten counties sending the most people to the Boise area in 2020 were in California.^[18] People arrived faster than builders could build, and the price made up the difference.

The Boise boom lasted one cycle. When an American family moves from Los Angeles to Boise, the country still needs the same number of homes, because the demand that leaves Los Angeles is the demand that shows up in Boise. Internal moves shift the pressure from one metro to another. Immigration adds to the national total. Every year's arrivals need homes that no household in the country needed the year before, and the flow does not pause after a hot streak. About a million legal immigrants a year, plus the recent border surge, landed in the same coastal metros for three decades straight. That is the gap between Boise's single spike and the standing shortage in Los Angeles.

The same squeeze shows up abroad. The European cities that absorbed the largest inflows now carry some of the developed world's heaviest housing costs. Rent runs about 75% of the average salary in London and 62% in Dublin.^[19]

Rent comes first

The rental market is where the crisis begins, because a renter cannot save for a down payment while rent eats the paycheck.

In 1990 the national median rent was $447 a month.^[1] By 2023 it reached $1,406.^[2] Most of that gap is the dollar losing value: adjusted for inflation, the real increase is closer to a third. That national average also hides two different Americas, the immigration magnets where real rent climbed steeply and the interior metros where it barely moved.

Adjusted for inflation, real rent in Los Angeles rose 55% between 1980 and 2014, and in Washington 86%, while the incomes of renters in those metros rose only 13% and 33%.^[20] In the low-immigration Midwest, Detroit and Indianapolis among them, real rent rose 15 to 25%, and renter incomes there fell.^[20]

In Miami, rent runs past $2,800 a month and a median home costs $550,000. A 20% down payment is $110,000. A household earning the area median of $65,000 would need roughly twelve years to save it, and only if nothing were left over after rent, taxes, and food. Most never save it, and the household stays renting indefinitely.

Miami and Los Angeles absorbed inflows the size Saiz measured, year after year, for three decades. During the 1924-1965 restriction era, renting was a stage of life, something people did in their twenties before buying. In the high-immigration metros today, a large share of working households rent permanently, with no realistic path to buying.

Supply never caught up to demand

The standard answer to rising prices is to build more. In theory it works. There is no fixed ceiling on how many homes a country can put up, and a metro that builds fast enough can absorb almost any number of new residents without prices breaking loose. Defenders of high immigration make exactly this case: the shortfall is a permitting and zoning failure that faster construction could solve.

The theory is sound. The thirty-five-year record is not. The metros that took in the most immigrants are the ones that built the least relative to the demand they faced. Los Angeles, the Bay Area, New York, and Boston draw the largest inflows, and they are also where zoning rules, environmental review, and a shortage of developable land hold construction down.^[16] Demand arrived faster than supply could move, so the pressure landed on price instead of on new units.

The arithmetic has to be done in households, not people, because a housing unit holds a household. Immigrants arrive into larger households than the national average, 3.49 people in an owned home against 2.7 for the country as a whole.^[21] During the 2021-2024 surge, net immigration of roughly 2.7 million people a year produced about 500,000 new households a year.^[22] Foreign-born householders accounted for a quarter of all U.S. household growth between 2019 and 2023.^[22]

Set against roughly 1.4 million housing units built each year, that national total is not by itself a shortage. The problem is where those households land. About 64% of the foreign-born live in 20 metros, and those are the same markets described above, the ones least able to add units when demand rises. A quarter of national household growth concentrated into a fifth of the country's housing markets, and the most constrained ones at that, is what turns an adequate national building rate into a local shortage.

The Sun Belt is the test of the opposite case. Texas, Florida, and the Carolinas permit homes at far higher rates than the coast,^[15] and they built an enormous amount. It still was not enough. Phoenix added 3 million residents since 1990 and Dallas-Fort Worth 4.5 million, and prices climbed in both. Fast building slowed the damage but did not prevent it.

This is the honest version of the case for building. A country can build its way out of an immigration-driven shortage - but only if it actually builds, in the places that need it, faster than the people arrive. For thirty-five years that has not happened, because the places where demand was highest were exactly the places where building was hardest. "Just build more" is a promise the high-immigration metros never kept.

From the 1920s to the 1960s, immigration was low and the pace of building was ordinary. It was enough, because supply only had to keep up with the natural growth of the people already here, and homeownership rose for four straight decades. Federal mortgage guarantees, the thirty-year loan, and mass suburban construction did much of that work, and low immigration meant they were not building against a rising inflow at the same time. The post-1990 wave pushed demand in the top metros past the pace of construction there, and affordability broke.

Demand is also the part that policy can actually move. A bill can lower immigration next year. Zoning reform, developable land, and construction crews change over decades, if at all. Cutting the inflow is the faster and more reliable lever, and it is the one within reach.

Recommendations

A bill can cut the inflow next year. Zoning reform, developable land, and construction crews take decades, so the demand side is where policy moves first.

• Cut legal immigration by at least 80%, from over a million a year to roughly 200,000. An inflow equal to 1% of a city's population raises rents about 1%, and the high-immigration metros absorbed inflows of that size year after year for three decades.
• End illegal immigration with enforcement. The 2021-2024 border surge added several million people on top of the legal flow, landing in the same metros where prices had already broken loose.
• Build into the shortage in the metros that need it. National construction of about 1.4 million units a year is adequate in aggregate and falls far short in the twenty metros absorbing most of the arrivals. Lower demand there first, then let supply close the gap.

Where the foreign-born share is low, a home costs about three times a family's income. Where it is high, it costs five to nine times. Until immigration falls back toward a level the housing supply can match, that gap will keep pricing American families out of the country's largest metros.

Sources

1. U.S. Census Bureau: Historical Census of Housing - Gross Rents - Median gross rent data, 1990 Census
2. U.S. Census Bureau: ACS 2023 Median Gross Rent - American Community Survey 1-Year Estimates, 2023
3. Saiz, Albert. "Immigration and housing rents in American cities." Journal of Urban Economics 61.2 (2007): 345-371
4. Center for Immigration Studies: Foreign-Born Population Report - 2025 estimates based on Census CPS data
5. Migration Policy Institute: Frequently Requested Statistics on Immigrants and Immigration in the United States - Immigrants and their U.S.-born children, 2024
6. Harvard JCHS: Home Cost-to-Income Ratio - Analysis of national housing affordability trends
7. U.S. Census Bureau: Foreign-Born Population - Official decennial census and ACS data on foreign-born population (1970-2023)
8. Migration Policy Institute: U.S. Immigrant Population Over Time - Historical immigration trends and analysis
9. DHS Yearbook of Immigration Statistics - Official legal permanent resident (green card) data by year
10. U.S. Census Bureau, American Community Survey 2023 - Median home value, median household income, median gross rent, and foreign-born share by metropolitan area
11. Construction Coverage: Cities With Highest Home Cost-to-Income Ratios - 2025 city rankings
12. Brookings Institution: Population Growth in Metro America - Analysis of metropolitan population trends since 1980
13. USDA Economic Research Service: Rural Economy and Population - Nonmetro population data, 1990-2020
14. Migration Policy Institute: U.S. Immigrant Population by Metropolitan Area - Geographic concentration of the foreign-born population
15. U.S. Census Bureau: Building Permits Survey - New residential construction permits by state and metro area
16. Saiz, Albert. "The Geographic Determinants of Housing Supply." Quarterly Journal of Economics 125.3 (2010): 1253-1296 - Land-use regulation and geography as constraints on housing supply
17. U.S. Census Bureau / Census Reporter: Boise City, ID Metro Area Profile - Foreign-born share of the Boise metropolitan population, American Community Survey
18. Idaho Department of Labor: Idaho Housing Market Analysis - Boise/Ada County home-price increases, price-to-income ratios, and in-migration from California, 2019-2022
19. Euronews: Europe's cities ranked by rent-to-salary ratio - Rent burden as a share of average salary, major European cities
20. Apartment List: How Have Rents Changed Since 1960? - Inflation-adjusted rent and renter-income growth by metropolitan area, 1980-2014, based on U.S. Census and American Community Survey data
21. U.S. Census Bureau, American Community Survey: Household size by nativity of householder - Average household size, foreign-born versus native-born householders, owner- and renter-occupied units
22. Harvard Joint Center for Housing Studies: What Effects Will the Recent Surge in Immigration Have on Household Growth? - Immigrant household formation and the foreign-born share of U.S. household growth, 2019-2023