Fox Business points out the obvious.
Americans are leaving the costliest metro areas for more affordable parts of the country at a faster rate than they are being replaced, according to an analysis of census data, reflecting the impact of housing costs on domestic migration patterns.
Those mostly likely to move from expensive to inexpensive metro areas were at the lower end of the income scale, under the age of 40 and without a bachelor's degree, the analysis by home-tracker Trulia found.
Looking at census migration patterns across the U.S. from 2010 to 2014, Trulia analyzed movement between the 10 most expensive metro areas -- including all of coastal California, New York City and Miami -- and the next 90 priciest metro areas, based on the percentage of income needed to pay a monthly mortgage on a typical home.
The net population flows skewed away from the most expensive markets ... The census data don't specify why a person moves, said Ralph McLaughlin, Trulia's chief economist, but the disproportionate impact on lower-income people suggests housing costs are a pressure point.
. . .
An April report from Trulia researcher Mark Uh found that lower-income households represent a larger share of those moving away from the most expensive markets than their overall population in those markets. For example, those earning less than $60,000 a year make up 27.4% of all households in the San Jose metro area, but they represent nearly half of all households moving away.
Another study this year from California policy group Next 10 and Beacon Economics found that New York state and California had the largest net losses of domestic migrants between 2007 and 2014, and that lower- and middle-income people were more likely to leave.
There's more at the link.
I know this is happening from personal experience, and the experience of my friends and acquaintances. When Miss D. and I decided, last year, that we wanted to buy our own place and make it a home, rather than just a rented residence, we considered several options. Moving closer to good friends was one part of our decision to relocate to Texas, but that didn't predicate us living in the town where we now reside. We would have considered several other towns or cities, but the much lower housing costs here were decisive. We got about twice the house for our money than we would have been able to buy in Nashville, TN, our previous home; or, to put it another way, we paid half as much here as we would have there for a house that had almost everything we wanted and needed.
Several fellow writers, bloggers and others have bought new homes over the past year. A sizable proportion of them have relocated to do so, to take advantage of lower housing costs. At least two have commented to me that even though they could have earned significantly higher salaries by staying in their former area, the saving in housing costs and other living expenses more than justified accepting a lower salary in order to relocate.
I still maintain the economy's in serious trouble. The cost of housing is yet another indicator that we're far from out of the woods yet.
Peter
As we noted elsewhere, the mortgage on our family's house (purchased in May) is several hundred dollars per month less than our combined rents in Anchorage used to be. We relocated about 25 miles, out of the greater metro area.
ReplyDeleteI got slapped in the face with this recently, I was hosting a friend of a friend who lives in New York. As part of the getting to know you chit-chat they asked about the rent on my apartment. Turns out I was paying less money a month than they were for better than double the space.
ReplyDeleteAnymore the cost of living percentage is the first thing I check when looking at a new area. The second is adjusting my current salary to see what the equivalent in the are is, was never happier than when I went from 125% of the national average cost of living down to 85%.
Yep, it's that bottom line, food or housing... Lots of places you get one or the other, but not both unless you have multiple roommates... My situation was $2500/mo for a mid-scale 2BR 920SQFT appt, or $900/mo for an 1800SQFT house... :-)
ReplyDeleteHousing is barely affordable any more, not with all the taxes and insurance added on. My actual house payment is about 1/2 of the mortgage cost, with taxes increasing every year.
ReplyDeleteThe problem is that many of those people are from areas where the cost of living is high because of Liberals and their social programs and the taxes that they cause.
ReplyDeleteThese people are moving to new areas, where they take their liberal ideas of what services they should receive with them, and vote accordingly.
Then the people who are unfortunate to live in those areas are voted into living in the same high tax hellhole that the newcomers just escaped from.
I moved from upstate NY to western MI and my expenses dropped by 50%. I was very fortunate that my salary stayed the same as what I was making in NY. The end result was after working full time for a year, I was able to go to part-time. Which certainly works for me :)
ReplyDeleteSuz
Old article but the numbers don't seem to be updated for any published more recently and this one adds some major metros.
ReplyDeletehttp://www.forbes.com/sites/laurashin/2014/08/21/how-far-100-goes-in-each-state-and-major-metropolitan-area/#2c25dbc66283
I currently live and work in Silicon Valley. My job is here, as are most of our friends. We like our home and neighborhood, and expect to have the house paid off before I retire.
ReplyDeleteWe'd like to be able to stay put in retirement, and if both the job market and my health stay robust we probably will - but if I can't work and finances get tight our plan is to sell and move away, because even in California there are lots of places where we could get an equally nice house for a small fraction of the price.
I saw an article in the local paper claiming that to be considered "modestly rich" in the SF Bay area you need a net worth of at least 6 million dollars(!?!). Somehow, I don't think that holds true almost anywhere else. Even living here, I'd feel pretty happy with just half that "modest" amount.
For reference, less than 100 miles away in Central Valley cities like Stockton or Modesto a teacher with a master's degree starts at ~$50K per year and tops out at ~$70K. I've a cousin who's taught there all her life and feels quite comfortably well off on that salary. While teachers living in Bay area top out at ~$20K more but barely scrape by.
Divemedic has the right of it.
ReplyDeleteOf course its perfectly alright to live in the socialist sxxxhole because you earn alot of money, and then move away upon retirement.
"what you do is what you believe; the rest is just talk"
Yes, Divemedic is unfortunately correct about at least part of what is happening. (Or: how Colorado moved Left as it became a target for priced-out Californians).
ReplyDeleteDespite the beauty of (some parts) of the Bay Area, I could move tomorrow away without much regret. Since we're lucky enough to have a home we bought long ago (when prices were merely high rather than ridiculous) we'll probably stay until I'm ready to retire. After that, I'd be happy to move away - I just need to keep trying to convince my wife and family to make the move.
Even though I'm a native Californian, I feel like an outsider in the Bay Area. I grew up in a rural and very conservative area, which suffers from the same leftwards drift that Colorado does - people sell their tract homes in LA or the Bay Area, retire to ag and timber country, and do their best to impose their own values in their new home. While condescending, of course, to the rural peasants who they grace with their enlightened presence and selfless leadership.
Heed Divemedic's words.
ReplyDeleteI'd suggest that those who moved to an area for more reasons than just economic - such as the social and political environment - engage in some "Welcome Wagon" activity when newcomers arrive. When one observes commie state license plates showing up in driveways, ring the doorbell, introduce yourself, welcome the newcomers, give them some useful gifts - a local telephone book, a map or two, a handful of carryout menus from the better local eateries, etc. - and then explain that "this (state your location) is not Kommifornia/New York/Taxachusetts/New Jersey/etc. and if you attempt to turn it into the place you just left by demanding increased government or restrictive laws you will not be happy here. "
I've seen neighborhoods ostracize new arrivals when the new arrivals establish their obnoxiousness - they can't find a local babysitter, no one knows which plumber is best (sometimes they're given the phone number for the worst one in the area), and when they need a hand for something everyone is busy and none of the neighbors have whatever it is that the newcomer wants/needs to borrow. One family, after they went "full northeastern liberal" at a PTA meeting started finding realtor and moving company ads in their mailbox (junk mail bombing is ridiculously easy to initiate....).
If this sounds harsh, just consider that your state name here can become the next Colorado.
i knew that oregon had been taken over, the western portions, but did not know colorado had suffered the same fate.
ReplyDeleteeastern pennsylvania, with some of the best soil for farming in the usa, was taken over by nyc-ers, who built huge houses and ruined the agriculture, and people whose families had lived there for centuries were taxed out of existence. meanwhile the relocated nyc-ers were travelling 2 hours to and from the big city to get to work.
the traffic there on weekends is ridiculous.
One of my long time coworkers experienced much the same. Moving here from Salt Lake City, they rented a 'shotgun shack' (long thin home with in-line rooms) for $1200 a month. He said he doubted the square footage of the entire space was more than 1000 square feet.
ReplyDeleteWhen he and wife moved here, he was pleasantly surprised to find they could afford a nearly two story 2000 square foot residence with yard with a mortgage of 3/4 of what they were paying for rent. He was lucky that he found a seller that NEEDED to sell home immediately as the husband was being relocated to another city far far away - he was in fact already in place. At the right place at the right time.
Property is priced high here. A bare acre with no utilities can sell for $60,000 - outrageous in my opinion. If you can afford to live out in the rurals, it is less expensive and to my mind, more peaceful unless you have rural crime that makes it less so.