The U.S. housing market is facing unprecedented shifts as immigration enforcement tightens, domestic migration patterns evolve and consumer confidence sours, according to a Tuesday webinar hosted by John Burns Research & Consulting (JBRC).
The presentation, “The State of US Demographics and Consumers: Lifts and Drags on Housing for the Year Ahead,” showed immigration at its lowest level in 40 years in 2025, builders reporting sales impacts from policy shifts and consumers becoming increasingly skeptical of “dream home” marketing.
Eric Finnigan – vice president of demographics research at JBRC — opened the webinar with data on immigration in the U.S. since the Trump administration took power last year.
“The (Dallas Federal Reserve) actually estimated that there’s more unauthorized immigrants leaving the country each month than moving in,” he said. “That’s quite rare through the year. We also were tracking policy shifts that were restricting legal channels of immigration, so reducing the number of folks coming into the country.”
A new $100,000 fee applied to companies filing H-1B applications has led to an 87% drop in applications from a year ago, according to a court filing cited by Finnigan.
Finnigan said 2025 immigration fell 82% year-over-year, the lowest level since the mid-80s.
“What I can say here is we forecast this for our clients, going out 10 years, and what that means for housing demand or rent and for sale,” he said. “So, I’m not going to share any forecast here. We reserve all that for our clients. But I can say plan for 2026 to be even lower than 2025.”
The impact on housing is already evident.
A JBRC survey of homebuilders conducted in mid-March found 41% nationwide with sales and buyer traffic negatively impacted by immigration policy shifts.
Regional variation was stark — with 80% of Northwest builders reporting negative impacts.
In the rental market, two-thirds of apartment developers and investors in Florida reported impacts from immigration enforcement.
The resale market also felt the strain. From a June 2025 survey, Finnigan noted that a quarter of agents nationally saw foreign buyers pull back during the spring selling season.
“It’s not all of what drove the weak spring selling season last year, but is a big part, especially if you look at the slower markets,” he said. “It’s the Northwest, Southwest and California.”
Domestic migration cools — even in Sun Belt
With immigration and birth rates falling, domestic net migration has become a primary source of population growth for most metro areas.
But even that engine is slowing.
“Americans are still moving to the south and west. The Sun Belt is still attracting most of the relocating households today,” Finnigan said. “But comparing 2019 to 2025, the domestic migration boost to local housing demand, if you take the average of all the top markets, it’s about half of what it was before the pandemic.”
Some markets that once thrived on migration have cooled.
Florida — which ranked as the fastest-growing state in 2021 — saw domestic net migration turn briefly negative in 2024 and remain weak in 2025.
Yet within the state, Ocala emerged as the fastest-growing metro area last year, according to JBRC data.
“If we’re looking at growth in Florida and projecting growth in Florida, we can’t use the same growth rate in Tampa that we use in Ocala,” Finnigan said.
Midwest markets are beginning to heat up as affordability draws households from pricier coastal regions.
Young families are increasingly moving from high-cost areas along the coasts and Northeast into Texas and the South, Finnegan added.
“[The Midwest] didn’t see the big run ups in price appreciation in 2021 to 2023 that a lot of the big Sun Belt markets saw,” he said. “And then for the relatively stable, we see some of the stalwarts here — the Atlantas, the Dallas and the Nashvilles of the world. You have Riverside, California.
“Some markets have flipped from positive before the pandemic to now negative; central New Jersey, some Florida markets.”
Consumer confidence takes a hit
Maegan Sherlock — manager of consumer research at JBRC — detailed how economic uncertainty has become a primary obstacle for housing transactions.
Half of consumers surveyed currently think the economy is in recession — up from 37% in June 2025.
“Half of consumers are pessimistic about the trajectory of the U.S. economy over the coming year, and that’s the highest share in our survey’s history,” Sherlock said. “Half of consumers also think we’re in a recession. But despite what some headlines might suggest or not, we’re not currently in a recession.
“When asked why they think we’re in a recession, it comes down to a lot of consumers feeling really pinched — thinking that prices for goods and services just they feel too high.”
That consumer mindset is leading to tentative spending — with nearly half saying it’s a bad time to buy a home.
“While they may be moving forward with big spending decisions, they’re doing so in a more measured mindset, and that ultimately translates into slower decision-making timelines,” said Sherlock.
Fear of overpaying tops the list of stressors for prospective buyers. Among homeowners, a quarter are waiting for mortgage rates to decline before purchasing. Among renters, more than half are saving for a down payment.
Economic uncertainty is the second-most-common factor holding both groups back, and Sherlock said its influence has “worsened significantly” since December of last year.
‘Dream home’ marketing, long-term outlook
The concept of the “dream home” is shifting — and in some cases disappearing — for consumers facing affordability constraints, the presentation showed.
Thirty-five percent of young singles and couples and roughly 40% of families report that their definition of a dream home has changed due to current housing market conditions, Sherlock said.
“Specifically for many young consumers, affordability is their primary concern,” she said. “Many feel that achieving homeownership is really difficult and are downsizing their expectations accordingly to match that reality.
“This often means less space, fewer features, maybe a willingness to compromise a little bit more, whether that’s on location or the style of the home, just in order to buy.” More than 60% of prospective buyers said they are willing to compromise on these elements.
Marketing language must evolve accordingly, Sherlock said.
She stressed that consumers are tuning out idealized messaging — with half of respondents rating phrases like “dream home” and “luxury living” as overused and tired.
“Consumers are responding not to aspiration, but to evidence that a message, and more importantly, the product itself, the home, was designed with their constraints and priorities in mind,” Sherlock said. “At the end of the day, we expect this trend is very likely to continue, just given the high pricing, high-interest rate environment that we’re in.
She cited Taylor Morrison’s “Homes Built for Real Life” campaign as an example of veering away from aspirational marketing toward practical, “context-aware” messaging.
Despite near-term headwinds, Finnigan offered a cautiously optimistic long-term view for the housing market.
Societal shifts — including young adults delaying household formation and marriage — have suppressed household growth for years but could reverse.
“What the data shows is that these 25-year-olds that choose to move back in with parents, they’re not stuck there forever,” Finnigan said. “By the time they hit 35, 90% of these folks have moved out on their own.”
He noted that the largest population group today is ages 32 to 38 — the prime first-time homebuying demographic.
“[It will be a] big lift on first-time homebuying demand in the next handful of years,” Finnigan said.