Why People Are Leaving California and The States They Relocate To

Why People Are Leaving California and the States they Relocate to

If you let the Google search results and local news media tell the story, lots of people are suddenly leaving California. Like most things you hear, there’s truth somewhere underneath the dramatic headlines.

Yes, people are moving out of state. In 2022, roughly 817,669 people moved out of California to live elsewhere. According to the census data, it was more of an exodus than any other state saw in 2022. 

The COVID-19 pandemic is often mentioned as a possible reason, and while it plays a role, there’s much more to the story. 

Santa Monica California

Santa Monica, California - via Pedro Szekely

The Main Reasons California Residents Choose to Leave

Every person who books their ticket out of California has different reasons, but there are common trends. If you know someone living in the state or have done some research, you’ve heard one or two of these reasons already.

Housing Affordability

One of the biggest issues that Californians face is housing affordability. It’s long been one of the priciest places in America to live and that remains true today. The national median house price is somewhere around $450,000, while California’s median is up around $680,000.

Cost of Living

The cost of buying a home in California is one thing, but residents also need to maintain a high income to afford daily expenses. California is one of the most expensive places to live, with high electricity costs, vehicle insurance costs, and inflation exaggerating everything even more.  

California Homes in the Afternoon Heat

California homes in the afternoon heat - via Jirka Matousek

Working From Home

Many new graduates or professionals in California saw a big shift after the pandemic and started working from home more often. Without pressure to live near offices in California cities, some employees are choosing to live in more affordable areas.

Business Opportunities

It’s been a struggle for businesses recently in some areas of California, with many issues reaching national news headlines. A 2022 report from the Hoover Institution said that over 350 businesses left California between 2018 and 2022 for various reasons. High tax, rent, and employee costs are probably the main factors.

Ventura, California

Ventura, California - via Ken Lund

Living Standards

Despite the incredible quality of life that California can support, it can be difficult for some residents to afford. Some people living in the state are looking to other areas of the country with a more affordable cost of living. 

These are some of the reasons people are trickling out of California, but is this unusual or just a continuing trend?

California’s 20-Year Resident Retention Issues 

It’s easy to focus on the short-term picture, but what’s happening in California is much more normal than you might think. 

Since 1992, California has been losing residents to other states. Only the years 1999 and 2000 showed an influx, with residents choosing to leave every year after that. 

So, it’s actually more like a 30-year resident retention trend than a 20-year retention trend. 

California Overview

California overview - via Forsaken Fotos

Which States Are California Residents Moving To?

The most prominent state that California residents are choosing to move to is Texas. Around 12.6% of the residents who leave Cali beaches and palm trees choose Texas as their new home.

Arizona accounts for about 9.1% of people leaving California, while Nevada and Washington both makeup around 7.2%. 

Oregon, Colorado, Florida, and New York are next on the list, each one getting about 5% of the people who move out of California.

The states drawing the least Californians are Vermont, North Dakota, and West Virginia.

What is the Right Option for You?

Moving to a more affordable state usually makes financial life easier. California has always demanded slightly more from its residents than other states, and the increased pressure on lower and middle-income families is showing. 

Not all of the problems California faces are unique, but the competitive real estate market doesn’t make things easier. 

If you’re looking for affordability, you should have an experienced realtor on your side. If you are selling your California property and leaving the area, the same thing is true. The aim is to get maximum value, whether selling or buying property in California.

The Jamison Team has been helping clients since 2008, so they’ve seen the housing market and economic trends firsthand. 

More Questions? Follow-up With Us!

If you have more questions about what to expect from the markets around the Bay Area, don’t be afraid to reach out to us today. Our experts are experienced in all property types and the entire San Francisco Bay Area, and we can help you to find what you need to know today.

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