In Vice Presidential Debate, Vance and Walz Blame High Housing Costs on Immigrants and Corporations

In tonight’s vice presidential debate, both candidates agreed that housing costs are too high. And both Sen. J.D. Vance (R-Ohio) and Minnesota Gov. Tim Walz had their favorite scapegoats to blame the problem on.

According to Vance, these were immigrants.

“Your housing is completely unaffordable because we brought in millions of illegal immigrants to compete with Americans for scarce homes,” the Republican vice presidential candidate said.

“Instead of blaming immigrants for everything related to housing, we can talk a little bit about Wall Street speculators buying housing and making them cheaper,” the Democrat responded.

Neither candidate’s answer is particularly surprising. Throughout the campaign, Vance blamed immigrants for driving up housing costs. GOP party platform He claims the deportations would help reduce housing costs.

Meanwhile, Democratic presidential candidate Vice President Kamala Harris has repeatedly blamed “corporate landlords” and “Wall Street” for rising rents and home prices. As a solution, approved Cap rents on properties owned by larger institutional investors and use antitrust law to prevent landlords from using rent recommendation software. Walz was merely imitating his running mate’s rhetoric.

Vance of course there is also He has repeatedly accused institutional investors of driving up Americans’ housing costs.

Both candidates’ claims have a simple logic. Increasing demand for housing, whether from immigrants or institutional investors, is expected to increase prices.

However, increasing demand should also be expected to increase supply, driving prices down again.

Institutional investors and immigrants also play an important and direct role in increasing housing supply. Investors provide capital to build new homes. Immigrants also provide labor for this.

There is at least one study to create It turns out that labor shortages resulting from immigration restrictions are more likely to increase the cost of housing than to reduce it through reduced demand.

When the government restricts housing construction through regulations that limit where and how much housing developers can build, high demand fails to translate into supply.

in California and New Jersey same percentage foreign national residents. California also has many more regulatory restrictions on home building than New Jersey. median house price As a result, it’s 30 percent cheaper in New Jersey.

Vance promised to share the article on social media later, citing a Federal Reserve study showing that immigration increases housing costs. (Campaign shared so far notes(Not that Fed officials are trying to suggest that immigration increases housing demand, which is.)

Contra Walz, a study found that restrictions on investor-owned rental housing increased rents and increased the incomes of residents in select neighborhoods by excluding low-income tenants. Studies Studies on the effects of rent recommendation software have found mixed effects on housing costs. In tight markets, such software increases rents. When the supply is loose it drops them.

As always, it is the ability of builders to add new supply that determines the price in the long run. Both candidates expressed it in their own ways, although Walz was more open about the relationship.

“We cut some of the bureaucracy,” he said, citing Minneapolis’ experience liberalizing zoning codes and seeing housing costs fall. Walz’s pro-supply words were nevertheless sandwiched between calls for more spending on affordable housing and down payment assistance.

On the supply side of the equation, Vance said the feds “have land that’s not being used for anything,” referring to Trump’s plan to open up federal lands for more development. These are not used for national parks. It is used and may be places where we build a lot of housing. “I think we should also open up to construction in this country.”

In some Western states, the federal government is the largest landowner and its undeveloped lands acting as a de facto urban growth boundary. Vance is right that opening these lands to development will increase supply and lower prices.

Unfortunately, support for housing development on currently federally owned land was quickly replaced by calls to expel illegal immigrants vying for homes.

So there you are. Both candidates recognized the role that home building and home supply play in reducing housing costs. But both were also willing to single out scapegoats (immigrants for Vance, Wall Street for Walz) for rising demand and prices.

Walz acknowledged tonight that there’s not much the federal government can do to reduce locally determined land use regulations. He’s right. But the federal government has many other tools it can use to make housing costs worse, from immigration restrictions to nationwide rent control.

And both candidates have stated that they will pull these levers.