The Trump Administration’s policy to deport more illegal immigrants may ultimately hurt the housing market and mortgage lenders in a variety of ways, including fewer immigrants buying homes and more foreclosures, according to immigration experts.

There’s no law against undocumented immigrants buying homes in the U.S. But the unauthorized immigrant can be deported for being in the U.S. illegally, which will likely affect the family being able to pay the mortgage, says Gary Acosta, CEO of the the National Association of Hispanic Real Estate Professionals, or NAHREP.

With about 70 percent of undocumented immigrants in the U.S. workforce, a breadwinner’s deportation can lead to financial ruin and the loss of a home, NAHREP says.

Many undocumented workers are married to U.S. residents or have children who were born in the U.S., Acosta says. Their extended family and friends could help with mortgage payments, or they may seek personal loans.

“Hispanics are very family oriented, so the family tends to rally around them,” Acosta says.

Even fear of deportation could cause fewer Hispanics to buy homes, which could have a chain reaction on the housing market because Hispanics make up half of the first-time home buying population, he says. Without them, it leaves fewer homeowners to move up to a larger, more expensive home after building home equity in their first home.

More Hispanics are buying homes as first-time homeowners in the U.S. than whites, according to the 2016 State of Hispanic Homeownership Report, put out in March by NAHREP. It found that since 2010, Hispanic home ownership has increased by more than 1.1 million homeowners, from almost 6.2 million in 2010 to 7.3 million in 2016. The number of non-Hispanic white homeowners during that time dropped by 2.2 million.

Without the increase in Hispanic homeowners, the post-recession housing market would be weaker and wealth gains from home equity appreciation would be a lot lower in many regions of the country, according to the report.

Effects of deportations

Deportations can affect the housing market first, mainly because that’s where many immigrants put their money, says Renata Castro, an immigration attorney in Pompano Beach, Fla., who started her career as a loan officer 13 years ago.

“When one person is deported, that sets off fear in the whole undocumented immigrant community,” Castro says.

If an entire family is deported, they may be unable to afford their mortgage. They may need someone in the U.S. who they’ve given power of attorney to sell the house for them, she says.

“Legally they don’t lose rights on the property,” Castro says of people being deported who have their name on the title of a house.

Most of the people in the country who are deported are Hispanic. Since 2005, 96 percent of deportees have been Hispanic and 85 percent have been working men, according to the NAHREP report. The largest Hispanic populations are in California, Arizona, Colorado, Florida, Illinois, New Jersey, New Mexico, New York and Texas.

There are 11.3 million undocumented people living in the United States, according to the NAHREP report. While it’s unlikely that all of them will be deported, even if only one-third, or 3.7 million people, were deported, the economic impact would be felt in many ways, it found.

Drop in housing prices?

Ultimately, deporting more immigrants could lead to more foreclosures and a drop in housing prices with a glut of housing supply, Castro says.

She estimates that 50 to 60 percent of Brazilians in Pompano Beach are undocumented and living there illegally, and deporting them en masse would lead to them not spending money in the U.S. and would affect the economy.

More deportations could lead to more foreclosures and a drop in housing prices, Castro says.

Acosta and NAHREP estimate that if one-third of illegal immigrants are deported during the next three years, it could cause a recession.

Labor shortage

Thirty-three percent of the construction workforce in the U.S. is Hispanic, and 11 percent of those are undocumented workers, Acosta says. Deporting them could lead to a labor shortage in the housing market, he says.

Considering that 85 percent of prior deportees were a part of the U.S. workforce, deporting one-third of the remaining undocumented population would mean the loss of 3.1 million workers, or 39 percent of the overall undocumented workforce, according to the Hispanic real estate group.

The construction industry already has a shortage of skilled labor, and deporting a large number of those workers would lead to more housing inventory shortages, the group says.

One assumption in the change to immigration enforcement policies is that immigrants take away jobs from American citizens and that these jobs would be filled by uneployed citizens, says Bill Mayben of Wm Mayben and Associates, a business consulting firm. It’s an inaccurate assumption, Mayben says.

“Throughout the history of America, immigrants on the path to assimilation into our culture have taken difficult menial jobs others did not want,” Mayben says, including home construction jobs. “This is still true.”

“Even with the knowledgeable work of thousands of immigrants, there is a labor shortage in housing construction,” he says.

“In most markets, representing a sizable portion of U.S. housing, production builders currently struggle to find effective labor to deliver new residences, both single homes and multi-family,” Mayben says. “Despite high wages, few American citizens gravitate to this work.”

U.S. employment levels are high. “Where would thousands of motivated, skilled construction laborers, with tools and the ability to use them as self-directed craftsmen, come from on short notice?” Mayben asks.

Disrupting the workforce will hurt the economy, he says, particularly in the west and southwest. New residential construction commonly accounts for 10 percent of economic activity and includes local government, architects, engineers, mortgage, trucking, infrastructure, suppliers and building companies.

“Bringing in new workers to regain the losses of talent this industry now faces will take a decade or more,” he says. “The loss of skilled construction labor on such a large scale is recessionary and immediate, and should concern every American.”

Deportations would also lead to less tax revenue. The Institute on Taxation and Economic Policy found that undocumented workers pay $11.7 billion per year in state and local taxes, or 8 percent of their income. Granting them legal status would increase this contribution by 8.6 percent, it found.

The worst-case financial scenario from high deportations is that they could lead to more foreclosures and “prolonged stagnation of the housing market in areas with high immigration enforcement policies,” according to the NAHREP report. That could turn the housing market, and the economy, back to 2008 levels.

And what else happened in 2008? Latino households lost their homes to foreclosures more often than any other ethnic or racial group, according to a joint study by Brigham Young University and Cornell University, which linked deportations to increased foreclosure rates among Hispanic households.