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Over the past 30 years, U.S. homeowners have been moving around less and less. A sweeping look by CoreLogic at homeowner migration patterns across the country shows homeowner mobility has been declining steadily over the past three decades.
According to the report, the median length of time between recorded purchase and subsequent sale of a home was 6.6 years in 2015. That’s compared to 4.4 years in 1985. The trend is similar to U.S. Census data that shows 5 percent of owner-occupied households moved between 2014 and 2015, as opposed to 9 percent between 1987 and 1988.
Even among homeowners who do move, 61 percent stayed within the same metro in 2015. These movers were more likely to trade up in homes and they paid a median price difference of $61,000 more for their subsequent home over the selling price of their prior home. At the same time, the number of those moving out of state fell to 24.6 percent and were at 15-year lows last year. These movers paid roughly the same price as what they sold for.
Of the homeowners moving out of state, more of them sold in high-appreciation, high-cost areas and bought in lower appreciation, more affordable areas. California had the largest number of emigrants in 2015, CoreLogic reported. The median sell price for these movers was $495,000, compared with a subsequent moved-to purchase price of $315,000 in other states.
“Although the California transplants moved to less expensive homes, the median home was priced in the 77th percentile of homes in the new metro area, a 15-percentage-point increase over the prior California residence,” the report stated.
New Jersey had highest ratio of owners moving out compared to owners moving in (2.64), followed by California (2.53), Illinois (1.79), Virginia (1.37), Colorado (1.18) and Pennsylvania (1.12).
Texas led states where more people were moving to than from, a ratio of 0.95. Florida (0.92), Arizona (0.75) and North Carolina (0.72) were close behind.
Some of the implications of declining household mobility, CoreLogic reported, include lower sales levels and tighter inventories. It may also have a negative impact on the home improvement sector.
According to Harvard’s Joint Center for Housing Studies’ 2015 report Emerging Trends in the Remodeling Market, “households tend to spend more on improvements both when they are putting their homes on the market and during the first several years after purchase.”
On the flip side, CoreLogic reported, when homeowners live in their homes longer, they have more time to build up equity, which, all things being equal, lowers the risk of default.
