Everyone is leaving California. Well, it feels like it. But what do the stats actually say? Let’s talk about it. This is so important for real estate professionals in particular to understand because it helps us talk about the market and plan for the future. Any stories to share? Please comment below.
1) Where are California residents moving?
Last year 653,551 residents left the state according to the American Community Survey. Here are the top destinations of where California residents are moving. Keep in mind 2020 data is not out yet. I included the top states below. If I had all fifty states on one graph it would be too big. Does anything surprise you?
2) Who is coming to California?
There is so much news about people leaving California, but we have quite a few people coming to the state too. Last year in 2019 there were 480,204 people who moved to California. It’s interesting that many residents moving here are from some of the top destination states.
3) Where are Californians MOVING THE LEAST?
This visual shows the locations where California residents moved the least in 2019. Does anything surprise you?
4) How can the population still be growing with so many leaving?
Last year we saw more people leave than come to California and that’s been the trend for at least ten years according to the American Community Survey (without considering international migration). So how is our population still growing? Well, in short we’ve had more births to offset the numbers. This is really important because we often hear things like, “Dude, our population keeps growing, so clearly we don’t have more people leaving. That’s just a made-up narrative.” Look, it’s both. We actually do have more residents leaving than coming, but births are helping our population continue to grow. On a side note, I wonder if we’ll see the birth rate go up in light of the pandemic. You know, will sheltering in place lead to more babies?
5) Aren’t more residents moving to Idaho?
It seems like Idaho is all the rage as a destination, so it might be surprising to see only 17,722 California residents moved to Idaho last year. But keep in mind these are 2019 stats and we could see the numbers increase in 2020. Let’s remember Idaho only has a total population of about 1.75 million people though, so having nearly eighteen thousand California residents move last year is huge because it essentially boosted the population by 1%. That’s enormous growth for Idaho, but it’s really just a drop in the bucket for California since we have over thirty nine million residents.
Thanks Meghan for letting me use the photo.
6) Less than 2% of the population moved last year
It seems like everyone and their Mom is leaving the state, but it’s really not true when considering the numbers from the U.S. Census Bureau. I’m not trying to minimize over 650,000 residents leaving last year, but that’s less than 2% of the state. It’s worth noting that over 98% of residents did not move last year.
7) Will the pandemic cause more people to move?
The stats above DO NOT reflect the pandemic because 2020 stats aren’t out yet. I’m anxious to see what new stats bring in light of so many residents being able to work from home now. By the way, here are three ways the pandemic has affected buyers.
8) Migration resources:
You can make your own visuals like mine by checking out the U.S. Census Bureau. But there is also a fun tool called the Census Flow Mapper that helps us see county to county migration (the only downfall is data only goes through 2018 so far). We can also look at migration reports from moving companies. Here’s a sampling of migration reports from Atlas Van Lines, United Van Lines, and North American Moving Services. We can also consider search queries to get clues for places people are thinking about, but I tend to put more weight on stats that show where people actually moved.
9) Why are people moving?
This is a huge question. It’s a dissertation and I won’t pretend to be qualified to answer it. But the usual suspects such as retirement, lifestyle, job change, politics, etc… are surely factors. I’d love to hear your take in the comments.
QUESTIONS FOR REAL ESTATE PROFESSIONALS
Who are your clients going to be over the next few years?
Who is coming to the market?
Who is leaving the market?
Who is going to be participating in the future market?
What steps do you need to take to position yourself for the future?
Where can you meet future clients?
I hope this was helpful.
Questions: Does anything surprise you about the stats above? Why are people leaving? Did I miss anything?
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Still puzzled by Idaho. Seems low.
I’d add climate to your list of why move. That’s the primary reason I would move. It’s getting too hot in the central valley….
Then don’t move to Texas! You would hate it.
I was just talking with someone who may move from SoCal to Vegas. That’s a big change. Climate is a big deal. Though we also have wildfires, which has not been easy for many reasons. This year we were basically inside for weeks and that gnaws at the soul over time.
“This year we were basically inside for weeks and that gnaws at the soul over time.”
That’s an apt description. It was the same where I live. It was brutal as the wildfires were horrible here. Not only that, but the smoke from other states also tends to make it way here. So we never made it to the mountains given everything.
Good point. I should have added that. The smoke has been unreal in recent years. This year was particularly bad.
It’s funny you say that. The two main reasons I hear for staying are the the climate (not too cold/ but hot summers) and proximity to both the ocean and mountains.
And let’s not forget drought. That’s going to become a very real problem in the not too distant future
Sigh. It’s been a very dry year this year.
We are proud to call ourselves Californians. But the tidal wave of wealth inequality is overwhelming those of us who aren’t at the crest of the wave. As retirees on a modest fixed income, we have to go where our income still buys us a dignified standard of living.
Thanks Warren. That makes sense. I’ve had family do the same.
I am surprised so many move from California to New York.
Hi Ryan, thanks for the actual stats on residents leaving CA. The people I know who have moved to other states are doing so for retirement or rebuilding after fires. They said the unaffordability of housing in the Bay Area and rising cost of living in CA were their main reasons. It doesn’t make sense to retire and pay increasing costs each year for health & home insurance, utilities, taxes, etc. when they can live much more reasonably in other states. And they can purchase beautiful homes with land for far less in other states.
Thank you Jordan. I really appreciate your commentary.
I thought Tennessee would be higher on the list. I have had several clients move there.
I have also had several clients that are moving back to CA after not adapting well to either the climate or the community. They often have a hard time with our market prices once they try to “get back in”.
I thought so too, but that’s not what the stats say. I’ll be curious to see if we note a change in 2020 stats (or other stats beyond the American Community Survey as I used).
I can think of five people on my Twitter feed that moved to TN in the past year (from Sacramento).
I bet there is shock at prices. Thanks Barb.
Illegal immigration for the past 40 odd years has caused housing prices and availability, to soar, pricing people out of the market . Another contributing factor, pushing people out , is resulting hugh increase in traffic and crowding
Thanks Sheila. Do you have stats to back up that claim about illegal immigration?
I think that would be hard to find figures to back that up given that they come here illegally. Figures that suggest upwards of 40 million (I’ve heard different figures) is going to have an impact. I’ve wondered if that hasn’t had a huge impact on homelessness as well.
I get that. It could be very challenging to count people. Hopefully some people are counted in the Census. That’s an uphill battle of course. I’d be curious to see actual stats. 40 million is a huge number that is basically equal to the population of California (or slightly higher actually).
I found that to be the case when I did relo appraisals. Once you’re out, it’s almost impossible to get back in !!!
Thanks Truett.
Yes…the property tax rate will reset (within limits), thereby causing the cost of a home prohibitive.
Yes, TN will surely be on the list for 2020! My team and I got licensed to do loans there because so many of our clients are moving!
That’s very telling of a trend. I’m anxious to see what TN stats look like for 2020. They certainly made the list of course in this year technically, but there weren’t enough sales to be a top state on my graph. Good luck on your loans. Congrats on responding to the market too. I always appreciate seeing that happen. The players of the market are constantly changing and we have to try to position ourselves for it.
Head scratching moment… THIS IS A HEAVILY REPEATABLE NEWS STORY that always attracts eyeballs….. I am a third generation native Californian… I have appraised for 28 yrs in every major market in the state… this TOPIC: LEAVING CA. comes up 3-5 years, like clock work, depending on the economic outlook… (notice no mention of this story, about 1 yr ago when jobs were growing) Are Taxes too high? yes… Is Cost of Living expensive? yes… Then…. why has the state grown 60% in 25 yrs…. Because… we have what America wants…. The California Dream… we continues to reinvent ourselves…and we will do it again…and again…and again… Be here when it happens… As they say in Disneyland: Enjoy the ride.
Bruce
Thanks Bruce. I hear you. Though this is where we want to look at the data to form our narrative. This is exactly why I talked about less than 2% of the market moving out of state last year. Moreover, we are at a pretty interesting place where the landscape is changing with a number of companies letting employees work remotely. Thus we have an extra layer to watch right now. I hear you though. I get it. Thanks.
I’ve been here six years and love the weather and geography. But the political climate has gone out of whack. Income and property taxes make retirement planning impossible. My biggest reason is a totally disempowered population in S CA. When work-from-home became a reality longterm, I was BYE!! Looking forward to AZ!!
Thanks Kevin. I really appreciate you sharing your story. Blessings to you in your new adventure.
Hi Ryan,
one of the reasons I have heard is the continuous attempts to raise property taxes. Some people have mentioned to me that eventually it will happen. If it does some people will not be able to afford their homes.
Thanks Eduardo. Taxes are a big deal. Residents are watching. It seems like every other year there is some sort of effort to increase taxes. On a different but related note I actually had a multi-million dollar home owner reach out recently wanting an appraisal just to be sure of options as the owner suspects taxes are going to increase under Biden. But that’s different than what you are talking about. And that’s not a political post.
Ryan, I know 4 families that have moved to Tennessee in the last 2 years all bc of the politics and taxes. Did your stats for growth of Ca include international immigration? California is a tough place to live and it’s hard to move from bc it does offer so much diversity. It’s beauty of the ocean to the Sierras isn’t really found anywhere else except the north coast. Future real estate clients? There’s is still a large movement from the Bay Area to our inland areas due to cost of living and remote work abilities. But there are problems that are developing in why homeowners aren’t selling and moving up. It’s unaffordable for them due to the larger price gaps/costs. New homeowners are having such a hard time getting into our high priced homes. Which is a whole different conversation. Thanks Ryan.
Great stuff Randy. I appreciate your critical thinking here. My stats above do not include international migration. Here is a piece to discuss that if anyone is interested. https://www.census.gov/library/stories/2019/12/net-international-migration-projected-to-fall-lowest-levels-this-decade.html
It’s a very real thing to have people leave due to politics and taxes. I hear that constantly. You bring up some important trends also. There are many moving parts as to why people are moving and why they are or aren’t buying. There is no one reason why for everyone though. That’s for sure.
Hello Ryan and Happy Weird Holiday Season to you and your family. I hope this finds you doing well and avoiding what ever that crazy stuff you fought earlier in the year. As to the chain of movement I would be very interested to see what is happening in 2020. Since I work on the fire cases I would throw out the comment that those who are older (like me and over 65) are heading to other places where it is less expensive. They are taking their insurance or plaintiff’s money, sale of lot and moving on. Probably chasing kids and grandkids. Since I am not a Californian as my wife is, moving out of the state would be easy for me, not so much for the other half. Good news where I would move to is not on your lists of hot spots and that would be just fine with me. Shoot I only need a 1/4 section of land to move horses and cows. Great article / topic to think about though, will really be interested in the numbers for 2020. Should be interesting Covid or no Covid. Take good care my friend and enjoy this time of year, Zoom calls included. Be safe.
Thank you Brad. I always enjoy your commentary. A Realtor on this thread (Jordan) also commented about fire insurance and that’s a very real dynamic. I think of the town of Paradise and all that burned and so few units that have been rebuilt. Where did all the people go? What did they do with their money? I hope someone writes a dissertation on that (and I realize lots of people did move to surrounding areas like Chico too (it’s not just out of state)). But on a bigger level, what are people doing in the entire state? I’ve certainly heard quite a few stories about a fire being a catalyst to move elsewhere.
Brad– always enjoy your point of view… I did not touch on the “pent up” demand on vacations during 2nd half of 2021, since so MANY families stayed home in Summer of 2020 — Remember, CA. to benefit from great Fall weather and tourists in that time period… plus XMAS !
Just to share my perspective…I am a Bay Area resident who will retire in the next two years. Expecting a much lower fixed retirement income (and as my politics and social justice work inclines me to stay on the West Coast), I have looked at moving to other more tax friendly states like Washington and Nevada.
However, I really wanted to stay in California (and away from snow) so in 2016, I purchased a town home in Greenhaven. This home is now successfully rented to a long term tenant whose expected move out date co-insides nicely with my retirement date.
Unfortunately, the impact of Climate Change continues to strengthen in our state resulting in increasingly higher temperatures, wild fires and flooding. While I grew up in Little Pocket, and am well aware of Sac’s hot weather attributes (Halloween 1960- 110 degrees), I now know I don’t want to be required to spend my “golden years” secluded in an air conditioned and filtered house for months on end.
Still trying to stay in CA and after reading this Sac Bee Article…https://www.sacbee.com/opinion/california-forum/article171601007.html – I’m now tracking homes in Humboldt County (“north of 40 degrees north latitude” 😉 Hoping their standard of available Health Care will improve in the coming years.
Thank you Patty. I really appreciate you taking time to share your story. Migration can be a touchy subject. There are a few comments today on my social media about Californians wrecking other states. I just think it’s important to stop and realize lots of people who leave are good folks who are just trying to make things work.
I was one who moved out to Utah in 2001. Came back in 2017. The first 2 years out of state were really tough — almost baled and came back several times. Then I got used to it, but when some major life factors changed and kids were growing up and didn’t want to stay there, we packed up and came back to NorCal, bringing along two college kids. We bought a much smaller house here, but on 70-degree days in December, as the lemons and oranges ripen, we’re always grateful to be back home. 🙂 Also, I thought I was fairly conservative politically when I moved away, but I soon realized I wasn’t their kind of conservative, and it helped me really understand what I value in public services, which was another reason to come back to CA.
Thank you Steve. That’s a really insightful comment. I appreciate you sharing your story.
Regarding #4, I’ve actually seen articles saying that the birth rate will be down due to the pandemic (https://www.brookings.edu/research/half-a-million-fewer-children-the-coming-covid-baby-bust/) and that it will have a negative effect on the economy. The numbers aren’t specifically for CA, but for the US overall.
Thank you. I appreciate it. I’ve seen that too. I guess we’ll have to see if that pans out or not. I hope someone does a study so we can know for certain. 🙂
Interesting information. I love the warmer climate and would move to California if I didn’t have so many roots here in Oregon.
There is no place like home and being near the people we love makes all the difference. California would welcome you though Gary. You’d fit right in. I can picture you buying a home in that Rio Linda water ski development we’ve talked about… 🙂
Great info here Ryan. Your numbers tell the story. You did a fantastic job of putting it into perspective. 653,000 very vocal anti-Californians left. 38 million chill Californians stayed. The Texas numbers are ironic, I wonder how many of those moving back were disgruntled Californians that went to Texas and found out that it is hot there and the nearest mountains are in Colorado? My advice to Californians planning to leave due to taxes, politics, Covid or overcrowding-do NOT sell your house-just rent it out. If you discover that (insert favored State du jour here) isnt all that the brochures touted, you may want to have a home to come back to. A home that hasnt increased by 20% in value and property taxes that re-set at 10 times what you paid before burning rubber in their UHaul for (insert favored State du jour here). My little sliver of California suits me fine, Ill stay here until I find something better. (Written from a sailboat off Dana Point in 70 degree weather in early December). Peace!
Thank you Mark. I know someone in Huntington Beach that moved to Idaho and did not sell her house and that came in really handy after a few freezing Idaho winters (in northern Idaho). Long story short. This person moved back to CA and sold the Idaho house.
No matter what I just appreciate when people leave graciously. Whether we are leaving a board position, job, neighborhood, or even the state, I admire the quality of leaving well. At times these days that seems to be a lost concept. I think sometimes people leave and they bash the state in the midst of everyone who is still here. It’s just not a good look and ultimately very unhelpful for others. We have far too much negativity these days. Anyway, that was a practical tidbit. Thanks to all my friends who leave and enjoy your space without going militant on your old place. 🙂
My sellers are unsure where they want to land now that they’ve sold their home and left the state( grandkids scattered all over the country) and they came up with the idea to rent an apt in Alabama near family, buy a travel trailer and go live in the areas they’re considering moving to, for a few months. Get to know folks, local customs (politics!) and if they like the weather( very important) before deciding where to buy. I think this is a smart way to ensure they never “move back”!
That sounds fun. I hope they find what they’re looking for. I know someone who tried that years ago and he ended up back in the same place he started. Haha.
I have sellers moving to Virginia, Alabama, Florida and Texas. So far all are retirement, or close to ,retirement age and cashing out their equity here and buying cheaper out of of state. I’m surprised by New York as a destination as their winters are BRUTAL! My clients moving forward will be move-up buyers still in the workforce( I have a couple of folks I sold their first home to 5-7 yrs ago and getting ready to list/buy move up home) and buyers moving here who are working from home in more expensive markets.
Thanks Karen. I always appreciate your take and it’s good to hear you have a vision for the future too in terms of who your clients will be. As far as New York I do wonder if we have more back and forth migration between SoCal / Bay Area and New York. I just don’t hear of too many New York residents moving to Sacramento in my circles I guess. It doesn’t seem as common as other states I hear about anyway.
Up into about 16 years ago, could not imagine leaving. Now cannot imagine going back. Nice place to visit.
Thanks Mark. I’m glad you feel at home where you are. It’s amazing how our perceptions can change. I grew up in SoCal and I never imaged I would live anywhere else. Now I cannot imagine moving back mainly due to affordability and traffic. Granted, if someone gave me a beach house it would be hard not to move… 🙂
Several sellers whom I have represented of late have moved to the Reno area. Other friends/family members have headed to the east coast (Carolinas and Florida). And a Texas here and there.
Thanks Mary Lou. I appreciate hearing your experience. I know an appraiser who moved to the Reno area too.
Really cool information! I am interested to see what the 2020 statistics will look like. I think the net domestic migration out number will be much bigger, and there will also be less international migration due to the pandemic.
Thanks Jack. Yeah, I think we’re going to see some different numbers. At some point I may bring in other sources of data too as the stats are based on the American Community Survey and they may differ slightly from some other sources. Though I think all the stats will tell the same story. Things are changing in California.
I’m a little behind but thanks Ryan! Great info even if it is 2019!
Thank you so much DeeDee.
The main reason, I believe, that Californians are leaving the state is because of their horrendous tax policies that cause the state to bleed out its population. As of 2019 the top three states that people are fleeing are California, New York, and Illinois and its no wonder why. They all rank 49th, 48th, and 36th in business tax friendliness. Along with this, these states have the least friendly taxes for individuals. California alone has the highest income tax, highest gas tax, and red taped any private contract work. This is so bad that 40% of a home’s cost is due to regulatory burdens. I highly recommend this video! (Its where I got all this information from)
https://youtu.be/ZF-SoE6zyqs
Thanks Colyn. I’ll check that out. Taxes are a big deal and that’s why Idaho has been such a popular destination. People are hands-down targeting states that are more tax-friendly so to speak.
During the 2008 housing crisis, I attended a joint Army training roughly split with California National Guard and Pennsylvania National Guard soldiers. Sometimes we talked housing on breaks. The CA soldiers could not believe what the PA soldiers were paying for housing (and vice versa). An E4 in CA was paying $600K for her new home and was thrilled at the low price. I was an O-3 from PA and I was paying $42K for my new home. We compared online pictures ….we both agreed mine was nicer and in a safer neighborhood. Which lead her to say “I can’t believe that you can get that for just 420K.” I said “It wasn’t 420K it was 42K”. When it sunk in the look on her face was not just shock but complete terror as well. I always wondered how she made out 3 years later when the balloon payment was due and if she still lives in CA.
Thanks Eric. Yeah, it’s wild here. The median price in the United States as a whole is 50%+ lower than the median price in California. Right now our median price is $758,990 for March 2021 in CA and it’s about $330,000 in the entire country. It comes down to location and scarcity. There are pluses and minuses to California for sure. There is no mistaking it’s not easy to afford the market though compared to other locations.
I was born in Calif. and grew up in SoCal as you did–mainly in HBeach. I also relocated to other parts of the state–Santa Barbara and Ventura to name a few before moving out-of-state. We both had college degrees and we found it very hard to save enough money, given the price of renting to save for a down payment on a home. Likewise the figures for people who could afford a home in these areas were dismal. At that time there was quite an exodus of people leaving. It was also difficult to find stable, well-paying employment and I was a native with an education (Science). Right out of college I figured that I would more than likely have to move to afford a home. I was not too keen on returning to SoCal or living in the Bay area. What finally made us move was the impact to the economy when SoCal went through another “micro-recession” that involved government contractors. That doesn’t impact just one industry, it spreads to others which a lot of people don’t consider. Likewise they don’t consider the impact of elections either. One of my husband’s clients had 500 employees and at the end of the year they were down to 20, if that. Then he lost his job. We were paying off student loans and had a goal of one day owning a home, so our dream was looking impossible in California. So we moved and I don’t regret it. I’ve lived here for awhile now. I had to adjust, especially to the weather and at times I still miss the coast–certain things that I grew-up with, but there are other things about the state that I DO NOT MISS. Likewise, I tend to visit other coasts instead of Calif., because I like to explore.
The move was good for us and one can make a life in another state/location. I recall that there were a lot of negative naysayers being critical of my relocation plans, especially in Santa Barbara–extremely smug types. I’ve looked at prices in Calif. and there’s no way that I’d be able to afford to move back there even with the equity that I’ve built in my home here. With that said it’s difficult here and the state that I moved too is apparently highly desirable because ex-Californians have moved here in droves as well as people from other states. Hope I didn’t write too much. I guess I got a bit “triggered” and wanted to offer another perspective.
It’s all good. I really appreciate your perspective. The reality is California is really expensive and it’s not easy to build a life here. I think my life would look much different had I stayed in SoCal. It’s easier in Sacramento when it comes to affordability. Though there are struggles anywhere. That’s just true. I’m happy that you are happy. Your home sounds a bit like the Boise area. I just had family visiting me this weekend who moved to Boise a couple years ago.
Thank you Ryan. It wasn’t easy to relocate & certainly under the conditions that we moved. We had to do it ourselves during winter–no company helping us. I could probably write a lot more about this subject, but I’ll try to keep it brief. I will say that after about 6 years my spouse was offered a position in NorCal and we declined as we felt it would be a lateral move and we didn’t feel that the company was as upfront about the situation. I was also leery given my past experiences. His territory would have been the Bay area and we probably would have had to live in the Sacramento area. They did try to lure us with that we’d be in NorCal, but I wasn’t stupid having grown-up in that state–not everyone is in High Tech. It’s hard for people to know if they’ve made the right decision, so you do your best with the info that you have. I live in Colorado and it hasn’t been easy here either. We also have fires–last summer was awful. We also have droughts, occasional floods, pollution, hail and the winter was brutal this past year. Still it all depends on how you look at things and the mountains are so beautiful. I do try to cultivate gratitude and acceptance, because it tends to feel healthier, but I still get itchy feet at times, so I try to calm that beast by traveling, if and when the opportunity presents. I grew-up with orange trees in my back yard, which ain’t happening here and I sometimes miss the scent of the sea and the orange blossoms, but I have other beauties of life to enjoy. From an ex-California girl–it is true that one can make a life in another state, although someone did accuse me once when I was pining for the sea of having too much orange juice in my blood. It’s nice talking to you.