In late 2025, the management team at Minneapolis-based Centerspace took stock of where immigration enforcement actions were in its home city.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n The crackdown, which drew national scrutiny after the January killings of Ren\u00e9e Good and Alex Pretti, had actually started a few months before. Despite the turmoil in the city, Centerspace President and CEO Anne Olson said the REIT has seen very few interactions with U.S. Immigration and Customs Enforcement agents at its properties so far.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cWe have a system where [enforcement actions are] reported,\u201d Olson said. \u201cAnd it’s really limited to just a couple of communities where we’ve seen some interruption, and that interruption would be from leasing all the way to resident skips. But so far, it has had a really minimal impact.\u201d<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n However, Olson noted that in January, Minneapolis had low turnover and few people looking for apartments. So far, it\u2019s \u201chard to tell if there’s any real impact,\u201d Olson said. \u201cWe would see that more once we have leasing season underway.\u201d<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n While Minneapolis has been the most recent hot spot for ICE’s immigration surge, it hasn’t been the only city affected by the crackdown. And, as the numbers are beginning to show, the apartment industry has not been immune to the agency’s actions. At certain product types and certain locations, the impact has been far from minimal, forcing some operators to take steps to educate their employees and residents.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Household formation drives apartment demand. And right now, fewer people are entering the country to fill apartments, especially at the lower end of the market.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n From mid-2024 to 2025, U.S. population growth was only half of the prior year\u2019s, <\/span><\/span><\/span><\/span><\/span><\/span>rising by just 1.8 million people<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/a> over the 12 months, according to U.S. Census Bureau data. The foreign-born population grew by 1.3 million over the period, a 54% drop from the same period the year before.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cInformation from a variety of sources shows either notably slowed growth in the foreign-born population or actual backtracking in the immigrant population,\u201d LeaseLock Chief Economist Greg Willett told Multifamily Dive in emailed comments.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n According to Willett, national housing numbers don\u2019t yet show slowing housing formation and rental demand. However, individual neighborhoods with a heavy immigrant population reveal deteriorating conditions.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cApartment vacancies began rising rapidly during the last half of 2025 in select submarkets<\/span><\/span> across Texas, Florida, Arizona and Southern California,\u201d Willett said.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n A recent survey from Irvine, California-based John Burns Research & Consulting shows similar trends. In Florida, 67% of apartment operators said that immigration impacts on leasing and occupancy were somewhat negative, according to data reviewed by Multifamily Dive.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Jay Lybik<\/p>\n Permission granted by Jay Lybik<\/p>\n \u00a0<\/p>\n<\/figcaption><\/figure>\n In Texas, 26% of respondents reported a somewhat negative impact, and 21% reported a significant negative impact. In the Southwest, 17% noted a significant negative impact and 22% saw a somewhat negative impact.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Jay Lybik, senior director of market research at Continental Properties, told Multifamily Dive that he believes the weakness in the Sun Belt is being impacted by lower immigration both legal and illegal, plus the financial stress on lower-income households.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cEveryone keeps talking about how oversupply at the top of the market is helping lower rents for Class C in Phoenix, Austin, and San Antonio,\u201d Lybik said. \u201cI don\u2019t believe it. I say, the Class C rents are going down in those markets because many households in that price point can\u2019t afford the rent or in the case of immigrants some are just straight out leaving the United States.\u201d<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n In 2025, the team at John Burns suspected that small multifamily properties and scattered-site single-family homes would be most affected by the immigration crackdown. However, what it found was that larger properties, namely older, class C assets, are also seeing occupancies fall after ICE raids.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Willett said he is seeing similar trends, adding that issues in the sector could make Fannie Mae and Freddie Mac hesitant to finance property transactions.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cThe pattern is especially pronounced in lower-tier Class C properties, a segment of the product mix that already has been facing headwinds from consumer price inflation that’s cutting into the spending power of a cash-strapped group of renters,\u201d Willett said.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Class C properties are facing other issues. Over the past few years, they have been hit especially hard, with rising interest, insurance and tax costs and plateauing rents.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Optional Caption<\/p>\n Permission granted by John Burns Research and Consulting in partnership with the National Apartment Association<\/p>\n \u00a0<\/p>\n<\/figcaption><\/figure>\n \u201cAnecdotally, the conversations I’m having are, \u2018We’re trying to get a class C deal sold. Those loans are coming due that were originated in 2021. We had faced some supply-related issues on the operation side, and now we’re hit with this demand issue from the immigration side,\u2019\u201d Chris Nebenzahl, vice president of rental research at Irvine, California-based John Burns, told Multifamily Dive. \u201cThat’s really putting some folks in a bit of a lurch from an occupancy perspective.\u201d<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Occupancy loss from immigration enforcement could be the \u201cstraw that breaks the camel’s back,\u201d Nebenzahl said.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cWhere you’ve got occupancy at 85%, economic occupancy at 78% and the loan is coming due, I think the lenders are going to say, \u2018Yeah, the jig is up. Either sell and get what you can or we’ll take the keys back,\u2019\u201d Nebenzahl said.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n The one saving grace for some older properties is that ICE operations can be hit-or-miss. Nebenzahl said in many cases, the impact of ICE raids on apartment occupancy may be an all-or-nothing proposition in a certain submarket or even at a specific property.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cIf there’s a rumor of the presence of ICE in the area, you could see 10% of the occupancy leave overnight or in a very short period,\u201d Nebenzahl told Multifamily Dive. \u201cAt other properties, they’re saying, \u2018We’ve got no issue.\u2019\u201d<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n Anthony Luna<\/p>\n Permission granted by Coastline Equity<\/p>\n \u00a0<\/p>\n<\/figcaption><\/figure>\n Anthony Luna, CEO of Coastline Equity, a commercial real estate advisory and property management firm that manages 1,000 units in Southern California, <\/span><\/span><\/span><\/span><\/span><\/span>noted the trend<\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/span><\/a> in two buildings he operates in Long Beach, California, in an area with a historically more Latino population.\u00a0<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n \u201cWhen the raids started, we saw move-outs spike to levels we\u2019d never seen before, and it happened in the middle of summer, which was really unusual,\u201d Luna told Multifamily Dive last year.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\n After the raids began, Luna said rents declined and move-outs jumped across Long Beach, especially in areas populated by more immigrant or Latino communities.<\/span><\/span><\/span><\/span><\/span><\/span><\/p>\nPopulation impacts<\/span><\/span><\/strong><\/span><\/span><\/span><\/h3>\n
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<\/div>\n<\/div>Class C concerns<\/span><\/span><\/strong><\/span><\/span><\/span><\/h3>\n
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<\/div>\n<\/div>All or nothing<\/span><\/span><\/strong><\/span><\/span><\/span><\/h3>\n
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