People Are Staying Put More Than Before

Shifting US populations have played a big role in commercial real estate over the last few years. Millions up and left old haunts and moved to follow businesses and, with them, jobs to the south and west.

All the shifting has had profound effects on the national and local economies and demographic makeup in the country. It has also had striking effects on CRE and multiple property types.

Things seem to be changing once again, according to a post by Nadia Evangelou, senior economist and director of real estate research at the National Association of Realtors. While 2021 saw a low rate of moving, 2022 looks to be even slower.

Evangelou did the analysis on US Postal Service change-of-address data because the Census Bureau hasn’t made its 2022 moving data available yet.

Despite an uptick of movement during the early part of the pandemic, there’s been a slowing for the last six years and 70% of zip codes saw fewer inbound moves in 2022 than in 2021.

While there are fewer people moving into most zip codes, there is some similarity in the states that are seeing the most net migration. Florida was at the top with a 1.9% net increase in population. The next four are Texas (1.6%), North Carolina (1.3%), South Carolina (1.7%) and Tennessee (1.2%). That seems like the patterns that have led to the shifts the country has experienced already.

Something common to these five and others that saw net population increases was a strong post-pandemic job recovery.

“Among the top 10 large areas with the highest inbound move rates, not only was their economy able to recover all the jobs that were lost at the beginning of the pandemic but there are about 5% on average more jobs now than in March 2020 in these areas,” Evangelou wrote. “Compared to the national level, the job market recovery after the pandemic has been more than twice as fast as nationwide in these areas.”

The five states with the greatest net loss of population were California (-0.3%), New York (-0.9%), Illinois (-0.8%), New Jersey (-0.1%), and Massachusetts (-0.1%). Some major cities — New York, San Francisco, and Chicago — kept losing population.

“While affordability hit record lows in 2022, it is the primary reason that people continue to relocate from these big city centers to less dense and more affordable areas,” she wrote. “Nevertheless, according to the USPS data, Los Angeles, San Jose, and Washington, DC experienced migration gains.”