People in Motion
So many anecdotes, so little time. We’ve all heard stories about how high local housing prices have gotten, even amid five years in a row of the fire season new normal. While this trend has been present for some time and for a multitude of reasons, the pandemic really kicked prices into high gear.
People are on the move and looking for a reset. They’re moving out of cities and into the burbs and beyond. They’re moving closer to family in another state. They’re “cashing in” and retiring early and are maybe unsure of where to go next. Couple this with an abundance of downsizing cash and years of low interest rates that keeps money moving and you get our sometimes wild and unpredictable housing market. A home, with all its challenges, can be a refuge from all the uncertainty out there in the world, so it makes sense that many folks are trying to upgrade their spaces and places, so to speak.
It’s too early to tell the pandemic’s full impact on population change around the country. We see it ourselves and hear the stories, even though “official” data isn’t available yet. The 2020 Census only caught the first few months of the pandemic before most people started moving. But the data confirms a longer-term trend: people are leaving expensive major metro areas for less expensive suburbs, or even less expensive major metros. And the pandemic accelerated these trends. Per the census, people have tended to stay within their metro area, but anecdotally it seems like a growing number are going farther afield. But where is everyone going? Again, official data is sparse but other data paints an interesting picture. The following three rankings offer good examples of this.
The first is from U-Haul and shows the net-gain of one-way moving trucks entering each state during 2020. Tennessee saw the most move-ins while California was last after ranking 49th in 2019 – again the pandemic accelerated an existing trend. Texas, Florida, Ohio, and Arizona rounded out the top five.
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The second is from another moving company, PODS, and shows data during 2020 and into Spring of 2021. This is similar to the U-Haul ranking in that it shows net-gains, but also interesting because it lists Boise, ID as #1, while the area was only 30th in U-Haul’s ranking. Could this be because PODS data incorporates some of 2021 and it just took awhile for word to get out about Idaho? I’ve heard from a number of folks that moved to the Gem State recently and you probably have too. Again, it’s all anecdotal but it will be interesting to see how this trend evolves.
The third list is another of those “best and worst places to retire” types from Bankrate, but it’s a good one using more recent data that lends some insight into why people might be choosing the areas they’re moving to.
Interestingly, Georgia tops the ranking of all states but doesn’t make the PODS top 20 and is only 10th on U-Haul’s list. Georgia bests Florida and Tennessee, both states that were featured prominently in the other lists. Why didn’t the Peach State show up as having more move-ins when it seems so promising? One explanation is that Bankrate’s ranking is geared toward retirees, but the various criteria they used to rank the states seemed appropriate regardless of age.
Bankrate says that Georgia matches California in the “weather” category (which is a surprise, frankly) while ranking 3rd on affordability compared to the Golden State’s 48th. California outranks Georgia in “wellness”, a category including things like access to exercise and good food, but how does declining affordability impact one’s wellness long-term? Affordability is California’s Achilles heel – housing prices might be more affordable in the state’s least desirable areas but why live there when you can move just about anywhere else?
https://www.bankrate.com/retirement/best-and-worst-states-for-retirement/
If it’s true that we’re seeing a seismic shift in housing priorities during the pandemic, data covering all of 2021 should be very interesting to see. Beyond that it’s anyone’s guess as to where all the people in motion finally settle, when that might happen, and what the economic implications might be.
Have questions? Ask me. I can help.
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