Roughly 223,000 Dreamers live in California in 2017. The vast majority of these residents are in school or employed, according to the Los Angeles Times.
Dreamers make up a large portion of the residents granted legal residency in the U.S. under Deferred Action for Childhood Arrivals (DACA), an executive order signed by President Obama in 2012. These are individuals born to undocumented parents who arrived in the U.S. when they were children and have been granted the legal right to stay.
However, the legality of these Dreamers’ presence is up in the air following the current administration’s rescission of DACA in September 2017. Lawmakers now have the option to formalize DACA or certain portions of the order. However, if they take no action, the program will end and Dreamers will be required to leave the country by the time their individual work authorizations expire, within the next two years.
Dreamers own homes, too
14% of the individuals who make up California’s Dreamer population are homeowners, according to Zillow. This amounts to 31,000 California homeowners under significant threat of deportation.
This threat to the housing market if felt across the state. If DACA is not formalized in some capacity and these individuals are deported, this represents a loss of:
- $111 million in property taxes to California; and
- $11.6 billion to California’s gross domestic product (GDP).
This also does not consider the impact ending DACA will have on future immigration into California. Currently, domestic migration is negative, meaning fewer residents move to California from other states than leave. The only reason California’s adult population is growing is due to immigrants from other nations.
The other big negative that will immediately and directly impact the housing market is the inevitable foreclosures that will follow in the wake of this forced exodus.
One-third of undocumented immigrants live in owner-occupied housing. Thus, when one income-earning householder is deported and that income stream is suddenly lost, the entire household is less likely to be able to timely make mortgage payments. This is eerily reminiscent of the recent foreclosure crisis, in which foreclosures were most severe in the communities that saw the most deportations.
The remaining undocumented immigrants live in rentals, and the loss of their presence will impact landlords in immigrant communities, too.
Finally, the deportation of DACA recipients and other undocumented immigrants will see a reduction in construction workers — an industry already experiencing a shortage. Fewer construction workers mean longer construction times and higher costs for builders and ultimately homebuyers and renters — the absolute worst thing for the future of the California housing market.
But there’s good news too: California’s immigrant-friendly policies will soften the impact here as compared to other states.
More information will follow as we watch how Congress plans to proceed in the coming months.