No, immigration does not increase your rent

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In the world, according to Senator JD Vance, immigrants are the root of all evil. During this week’s vice presidential debate with Gov. Tim Walz, he argued they were to blame for rising housing prices.

Economists were quick to point out that his “evidence” was an out-of-context quote from a speech by a Federal Reserve official. Yet immigrants are people, and people need housing. So could the recent rise in immigration be a major factor in the recent surge in housing costs?

There are many reasons to say no; one of them is timing. Basically, most of the increase in rents took place in 2021, and a surge in immigration began in 2022. Rents skyrocketed as we emerged from the pandemic crisis; the surge in immigration came later, according to Congressional Budget Office estimates of net immigration in recent years, as well as Bureau of Labor Statistics estimates of rent increases for new tenants.

So what caused the rents to rise? There are longer-term problems, mainly the failure to build enough housing. But the most likely proximate cause of rising rents was Zoom, that is, the increase in remote work. On average, people working from home sought more homes to work from. I know this explanation isn’t satisfying to many people because it doesn’t bring up obvious villains. But it’s the best story we have.

Paul Krugman has been a columnist for The New York Times since 1999. He is a distinguished professor in the Graduate Center Economics Ph.D. program and a distinguished scholar at the Luxembourg Income Study Center at the City University of New York. He is also Professor Emeritus at the Woodrow Wilson School at Princeton University. In 2008, he received the Nobel Prize in Economics for his work on the theory of international trade.