HUD Says Immigrants, The Unmarried Are Worsening The Housing Crisis

The United States has barely made a dent in the housing shortage for the poorest people in the country, and the Department of Housing and Urban Development is suggesting a shift in focus to help address the problem. 

The biennial Worst Case Housing Needs report released this month, the first published since President Donald Trump took over from Joe Biden, departs significantly from its predecessors over the past decade by citing social factors, chief among them immigration, that it says are negatively impacting the housing market.

The report found that more than 8.5 million households were facing acute financial strain due to housing costs, an "insignificant" 62,000 reduction from the 2023 report, according to HUD. It points to immigration, declining rates of marriage and subsidies from housing programs as major culprits for the nation's housing crisis.

The change marks a pivot in emphasis from supply-side fundamentals like unit creation to the factors that play into demand.

“While incentivizing an increase in the supply of housing that is affordable to households across the income spectrum is critical for reducing worst case needs, moderating demand factors that exacerbate the crisis, such as large-scale immigration, loose monetary policy, and subsidies that may drive demand faster than supply can keep up, is perhaps even more critical,” the report says. 

The solution should include policies that go beyond brick-and-mortar, according to the report.

HUD suggests that declining marriage rates delay household formation and leave more individuals on that market and that policymakers should consider "interventions that increase marriage" as a way to boost housing affordability.

Congress mandates that HUD generates the Worst Case Housing Needs report, which uses two-year-old data to track the number of renters earning 50% or less of the area median income and paying at least half of their earnings toward rent, or living in severely inadequate housing, without any federal housing assistance. 

The report found that, in 2023, there were 59 affordable units available for every 100 households making less than half the area median income, which fluctuates based on incomes in a given county. 

“HUD’s comprehensive 2025 Worst Case Housing Needs report is clear — the Biden administration’s open-border policies encouraged mass illegal migration, fueling the housing availability and affordability crisis between 2021 and 2023 that led us to the situation we are in today,” a HUD spokesperson said in a statement to Bisnow.

The report goes on to state that “in states like California and New York, Biden’s border crisis accounted for 100 percent of all rental price growth.”

HUD's expanded focus follows the Trump administration's broad and ongoing crackdown on immigrant communities, including mass deportations.

Immigration and Customs Enforcement deployed to several cities across the country, including Los Angeles and New York, and the White House said it has deported some 500,000 people.

That number is disputed, with a November NPR report indicating that roughly 7,500 people are being deported per week, or 300,000 in the first 10 months of Trump's second presidency.

The foreign-born population in the U.S. increased by 5.1 million people from 2022 to 2024, the largest two-year jump in American history, according to HUD.

That influx in immigration, which HUD said brought the total foreign-born population to a “staggering 53 million individuals,” was responsible for two-thirds of rental demand growth nationwide and all of the growth in New York and California, the agency found. 

A 2024 report from Harvard University's Joint Center for Housing Studies found that a surge in immigration in 2022 and 2023 did not align with the timing of ballooning home prices in 2020 and 2021.

Foreign-born households accounted for just 25% of household growth from 2019 to 2023, and 16% of all households, or 21 million homes, were headed by an immigrant in 2023, the report found.

It’s the first time in more than a decade that the report mentions immigration. The last reference, in the 2009 report, said there was little evidence that immigration was a main factor that led to the 8-percentage-point jump in housing-related financial strain among the Latino population in that year’s data. 

Much of the foreign-born population tracked by HUD is in the country legally, with Pew Research finding that unauthorized immigrants represented 27% of the foreign-born population and 4.1% of the total U.S. population in 2023.

Lisa Sturtevant, chief economist at Bright MLS, a multiple listing service focused on the Mid-Atlantic, said the government’s expansion of scope to focus on demand-side factors was helpful because it better captured the local nuances that drive market activity.

But, she said it was important to take a holistic approach when quantifying the impacts of immigration. 

“There are lots of communities in which, but for international immigration, they wouldn't have seen the same level of economic growth and job growth,” she said. 

Supply-side subsidy programs like the Low Income Housing Tax Credit and Opportunity Zones that encourage development have proven to be an efficient and more effective way to begin to address affordability issues, rental housing economist Jay Parsons said.

Market rate multifamily firms facing high debt and construction costs have struggled to get their own properties out of the ground this year. Affordable housing developers today, who are building for a lower price point, face an even more daunting task that leads to the need for tax credits and other incentives to offset costs, Parsons said. 

“The property is not getting built without that happening,” he said. 

The report is critical of tenant-side subsidies like rental assistance, suggesting they help the recipients but ultimately drive rents higher and harm the millions of households not receiving the benefit.

Inclusionary zoning that requires multiple income levels be accommodated at the same property makes projects untenable and stifles development, HUD said. 

HUD said the delivery of 591,000 new apartment units in 2024, the highest number since the 1970s, is evidence that insufficient housing availability is “not solely in a lack of supply, but rather in prices that are too high” and that “excessive demand is a key driver of the housing crisis.”