Nearly Half of Migrants to Major Metros Experience Rent Increases
Renters moving to major metros have to cope with significantly higher apartment rents and cost of living.
“Almost 50% of the movers to the top metros declared that they experienced an increase in housing costs,” Maria Gatea of Yardi Storage Café, tells GlobeSt.com. “However, that might not be that surprising, as 32% of the people moving wanted larger or better-quality homes or more desirable neighborhoods,” . Naturally, this translates into increased housing costs. It’s also worth noting that, in addition, almost 15% of the movers declared they relocated in order to form their own household, which usually implies getting a larger home.”
The migration patterns are similar across metros. Most movers are migrating from nearby markets, rather than a significant move. “People moving to the top metros tend to come from another nearby metro area. For example, the Los Angeles metro area saw almost 45,000 newcomers from the adjacent Riverside-San Bernardino metro area, while the San Francisco metro area received almost 29,000 new residents from Metro San Jose,” says Gatea. “The Houston and Dallas metro areas are each other’s main source of new residents, without a clear winner in terms of net migration, as the number of people moving between the two is balanced, at about 16,000 in each direction.” However, for Atlanta, Miami and Chicago, most new arrivals came from New York City, breaking with the trend.
Inbound migration has played a significant role in driving housing costs up; however, so far, they aren’t deterring new entrants into the market. “The metros that saw decades of high inbound migration, such as Los Angeles and New York, are now dealing with sky-high housing costs that are indeed deterring population growth,” says Gatea. “Interestingly enough, inbound migration to both metros is not slowing down—on the contrary, Metro New York is first nationally in terms of inbound migration and Los Angeles metro is second, with 417,000 and 360,000 newcomers respectively in one year.”
However, these markets are also seeing significant outward migration as well. “Retaining their residents, on the other hand, is an issue. Even more people are moving out, resulting in negative net migration of 63,000 in New York’s case and 16,500 for Los Angeles,” says Gatea. “The population change, which also includes deaths and births, is also negative for Metro New York and Los Angeles—decreases of 19,500 and 7,200 respectively.”
Interestingly, Gen-X is the biggest demographic moving between metros. “Gen Xers, now at the peak of their professional lives, are opting for more competitive markets where opportunities abound in terms of both employment and lifestyle options,” says Gatea. “The members of Generation X are generally less burdened by student debt than millennials and register higher household incomes, which allows them to take on a mortgage. Whether relocating for jobs, to be closer to family or specifically to get access to better housing and neighborhoods, Gen Xers are generally willing to pay more for high-quality, amenity-rich housing and can easily afford all the other costs related to moving.”