MortgagePoint July 2023

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July 2023 » 69 J O U R N A L July 2023 POTENTIAL HOME SAVINGS DRIVING MORE CALIFORNIANS TO TEXAS S ome 111,000 people—an estimated 300 people a day—exchanged the sunny Californian skies for Texan ones in 2021, the peak period of the last decade and a whopping 80% increase compared to 2012 figures, according to a new analysis from StorageCafe. Not only is California to Texas migration not slowing down but the route is also getting more crowded. This route is not a one-way street, but Texans tend to move to California in much smaller numbers. In 2021, a total of 33,000 Lone Star residents made California their home. Key Findings: » California to Texas is the most popular interstate relocation route in the U.S., only challenged by New York to Florida, with 93,000 people making the move » 2021 was a record-breaking year in terms of California-to-Texas move-ins, with roughly 111,000 people taking the route » In 2021, about 1 in 2 people who migrated from California to Texas were millennials » Santa Clara to Dallas County brings in the most savings if you want to buy a home, with a 258% difference in listing prices ($410,000 vs. $1,467,000) The reasons behind a California-to-Texas move are varied, but affordability and job options are major incentives that support the decision to swap one state for another. Among the things that help lure people to Texas are the no-income tax policy, the lower cost of living, and the robust employment opportunities significantly bolstered by the tech and energy sectors. The remote work trend is further fueling the movement, as many people who are no longer tied down to an office can easily choose friendlier housing markets, some- times without letting go of their considerable Californian paychecks. In addition to lower housing costs, transplants also get somewhat larger living spaces, with single-family homes in Texas being 17% bigger than Californian residences. Utilities are generally cheaper in Texas as well, roughly 20% less than in California. Texas has actively pursued an econom- ic strategy that includes creating a busi- ness-friendly environment that helped not only to retain businesses but also attract new ones, including some high-profile movers such as Elon Musk and Joe Rogan, who relo- cated some of their activities here. As it turns out, over 100 companies have moved their headquarters to Texas since 2020, with 40% of them coming from California. Millennials With Above-Average In- comes Drive California-to-Texas Migration Most people moving from California to Texas are millennials, making up 46% of those decamping to Texas. Gen Xers are also jumping on the bandwagon, with 21% of those who moved to Texas being 40- to 55-year-olds. Baby boomers and Gen Zers are also joining in but in much smaller numbers. The millennials who moved to Texas come with a household income of $114,000 per year, 21% more than what millenni- als bring home overall at a national level ($94,000 per year). LA County to Collin County Gets Mov- ers 62% Bigger Houses, While Homebuying Savings Could Reach $1 Million When Choosing Dallas Over San Jose Californians have been moving to Texas in droves for over a decade now. But not all locations have the same appeal, especially since California is not an easy-to-let-go state. Benefitting from historically friendly fundamentals, Texas offers cheaper housing options than California. But for how long re- mains to be seen, as the massive demand that put an extra strain on the market, particularly on in-demand locations, caused substantial price increases. Based on Zillow data, the me- dian home value in Texas has increased by 54% in the last five years, whereas California's median home values went up by 42% during the same period. However, overall, Texas still stands out as a great destination for those who seek a more relaxed housing landscape while benefiting from a sound job market in an amenity-laden environment. And for some of those taking the route from California to Texas, the perks can amount to amazing financial savings as well as more living space at home. Californians Following Two Moving Routes Can Save Over $1 Million When Buying a Home in Texas Moving from California to Texas is good news if you're contemplating becoming a

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