NAHB breaks with Trump as ICE detentions cancel home builds

An industry trade group is taking a rare stance against the Trump administration and its immigration crackdown, in weighing its negative impact on the housing market. 

The National Association of Homebuilders joined two other business organizations in an amici brief filed last week in a federal case arguing against the government's mandatory detention of noncitizens. While real estate organizations in the past two years have periodically weighed the housing market impacts of reduced immigration, the NAHB's filing is an overt challenge to Trump policy. 

The habeas corpus lawsuit filed by three noncitizen detainees this year names the Department of Homeland Security, and Immigration and Customs Enforcement as defendants. The NAHB, in suggesting less-costly supervised release as an alternative to detention, argues that the policy has contributed to an "already strained" homebuilding workforce and constrained production. 

"NAHB and its members have been negatively impacted by the Government's novel mandatory detention policy, which has removed labor from the workforce, forcing build cancellations, causing loss of revenue, materials, jobs for U.S.-born workers, and a sharp decline in the number of available homes on the market," attorneys wrote.

The case focuses on the Trump administration's interpretation of a 1996 immigration law regarding mandatory detention. The amicus brief argues that the U.S. Constitution's Due Process Clause provides for a constitutionally required hearing before a judge, the filing states. 

Representatives for DHS and ICE didn't respond to a request for comment Wednesday afternoon.

The Trump immigration agenda has extended to housing regulators, as the Department of Housing and Urban Development has sought to end housing benefits for ineligible non-citizens. The administration has also claimed that immigrants drove up housing prices, and that its deportation campaign has driven down rent prices.

How deportations have affected homebuilding

The filing describes the detainment of over 75,000 workers at a daily cost of $6.5 million to American taxpayers, although the NAHB doesn't estimate how many of those detainees are in homebuilding trades. In addition to being detained, workers are also reportedly not showing up to work out of fear of arrest. 

The trade group cites research showing that U.S. born workers aren't filling vacancies left by immigrant workers because their job site roles are complementary. Noncitizen laborers are more likely to take on jobs with lower pay, on-the-job hazards and irregular schedules, the filing states. 

Further, detaining immigrants from a work crew composed of citizens and noncitizens can stall an entire project because of insufficient labor. 

"When labor shortages disrupt production and construction, prices rise, projects are delayed, and housing becomes more expensive and less available," the filing reads.

Homebuilder confidence has tumbled this year and mortgage applications for new homes have waned as rising rates have dampened the mortgage industry outlook.

The amici brief, which was joined by the Texas Business Immigration Coalition and the Texas United Auto and Community Alliance, argues that a bond hearing would be a minimal burden on the government. Supervised release would allow noncitizens to continue to work. 

The 5th Circuit Court of Appeals heard oral arguments last week in the case. The issue has been litigated in various federal district and appellate courts this year and could reach the U.S. Supreme Court.