Migration Patterns within the United States

Migration Patterns within the United States

The analysis and conclusions set forth are those of the authors and do not indicate concurrence by other members of the research staff or the Board of Governors.

Raven MolloyFederal Reserve Board of Governors

Christopher L. SmithFederal Reserve Board of Governors

Abigail WozniakUniversity of Notre Dame

May 17, 2012

Migration rates within the United States are currently at historically low levels.

Migration = a change of residence from one location in the U.S. to another.o Includes moves across states, across counties, or even across the

street.o Does not include moves into or out of the U.S.

Many have speculated that the housing market or economic recession may be responsible.

Homeowners who owe more on their mortgage than their house is worth may not be able to move.

Migration usually falls during economic recessions because job prospects are poor and fewer people form new households.

Motivation

Is the current low level of migration purely cyclical?

If so, we would expect migration to increase in the next few years as the job market improves, household formation picks up, and house prices rise.

But other factors may also play a role: Aging of the population: old people tend to move less than young

people, and older cohorts are becoming a larger share of the population.

Motivation

Goal of this research: to document patterns in migration over the past several decades.

Have certain types of migration (i.e. long-distance vs. short distance) fallen more than others?

Has migration for certain demographic or socioeconomic groups fallen more than others?

Has migration in certain locations fallen more than others?

Answering these questions can help shed light on the reason for low migration rates.

Why should REALTORs care? Many people who move buy and/or sell home. Migration of renters can also stimulate home purchases, such as

older couples who downsize after children move out.

Motivation

Examine changes in aggregate migration since 1980s.

Examine changes in migration for different demographic and socioeconomic groups.

Compare changes in migration in states with many underwater homeowners to other states.

Outline

Changes in migration over time

.1

.12

.14

.16

.18

.2F

ract

ion

of

pop

ula

tion

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010Year

(Any Distance)

Fraction of Population Who Moved in the Last 12 Months

Source: Current Population Survey.

Reasons for moving vary by distance of move: Short distance: Housing related, such as for a larger/better home,

to own rather than rent. Long distance: Job related, such as to start a new job or look for

work.




.06

.08

.1

.12

.14

Fra

ctio

n o

f p

opul

atio

n

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010Year

Fraction of Population Who Moved Within County



0

.01

.02

.03

.04

.05F

ract

ion

of

pop

ula

tion

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010Year

Fraction of Population Who Moved Across County, Within State



0

.01

.02

.03

.04

.05F

ract

ion

of

pop

ula

tion

1965 1970 1975 1980 1985 1990 1995 2000 2005 2010Year

Fraction of Population Who Moved Across States

Aggregate migration has fallen since the 1980s.

Relatively steady trend over time. No unusually sharp drops coinciding with the housing market downturn or economic recession.

Declines are evident for all distances, but are proportionally larger for longer distances.

Within-county migration fell from 12 percent of the population to 9 percent, a decrease of 1/4.

Across state migration fell from 3 percent to 1½ percent, a decrease of 1/2.


Migration by demographic/socioeconomic group


0

.01

.02

.03

.04

.05

.06F

ract

ion

of

age

gro

up

pop

ula

tion

1980 1985 1990 1995 2000 2005 2010Year

age 0-17 age 18-24 age 25-34

age 35-44 age 45-64 age 65+

Migration Across State by Age



0

.01

.02

.03

.04

.05

.06

.07F

ract

ion

of

gro

up p

opu

latio

n

1980 1985 1990 1995 2000 2005 2010Year

Renters Homeowners

Migration Across State by Homeownership

Migration across states has fallen for most groups: Age Homeownership status Race/ethnicity Nativity/citizenship Marital status Presence of children in household Education Income Employment status

The decline in migration is widespread across many different types of people.


The large drop in house prices has left many homeowners “underwater”, i.e. owing more on their mortgage than their house is worth.

Being underwater makes it more difficult to sell the house. The homeowner must either make up the difference between the

sales price and mortgage amount (plus pay the sales commission, taxes, etc.), or convince the bank to accept a short sale.

With more than 20 percent of all homeowners underwater, it seems reasonable to think that this channel has reduced migration.

If this were true, we would expect migration out of states with many underwater homeowners to have fallen more than other states.

The role of underwater homeowners


Source. Current Population Survey and CoreLogic.

Cha

nge

in M

igra

tion

Out

of S

tate

2006

to 2

011

Fraction of Underwater Homeowners in 2009Q30 .05 .1 .15 .2 .25 .3 .35 .4 .45 .5 .55 .6 .65 .7

-.06

-.04

-.02

0

.02

.04

AL

AK

AZ

AR

CA

CO

CT

DE

DC

FLGA

HI

ID

IL

IN

IA

KSKY LA

ME MDMAMI

MN

MSMO

MT

NE

NVNH

NJ

NM

NY

NCND OH

OK

OR

PA

RI

SC

TN

TX

UT

VAWA

WV WI

WY


Source. Current Population Survey and CoreLogic.

.01

.02

.03

.04

.05

Fra

ctio

n o

f Pop

ulat

ion

Mov

ing

Out

of S

tate

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011Year

Arizona California FloridaMichigan Nevada

Out-Migration from States with a High Share of Underwater Homeowners

Migration out of states with more underwater homeowners has not fallen more than other states.

Why not? Gain from moving across states is very large. For example, many

people who migrate across states take a new job. Even if they can’t sell, underwater homeowners can rent their

property or default on their loan. The gain from moving must be large enough to overcome the cost.

Other research has found that local moves are lower in locations with many underwater homeowners (Ferriera, Gyourko and Tracy 2011).


Migration within the United States has been trending down since the 1980s. No sharp decreases during the recession or housing market downturn.

Trends are downward for moves of all distances and most demographic and socioeconomic groups.

Downward trend in long-distance migration cannot be explained by underwater homeowners.

Conclusions

So why is migration falling?

There are no easy answers. This is an important topic for future research.

Conclusions

Migration Patterns within the United States

Technology

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