Friday, January 26, 2007

On the move

Relocating from one place to another has been on going since Adam and Eve were abruptly relocated from the Garden of Eden. Man has been following the food chain for at least a few hundred thousand years. Today, a job transfer is still one of the top reasons for leaving one place and moving to another. Up until a few hundred years ago, most of us lived, worked and expired within a few miles of where we began. In a free and affluent society, moving is no longer viewed as a dreaded hardship. Discretionary modern movers relocate for a variety of reasons that are very different from our grandparents.

Demographers tell us that most of us will relocate from one community to another, six times during our lifetime. Technology allows more exact tracking of our movements. The state’s Franchise Tax Board and the DMV have a good idea about where people are from and where they are now. There recently published finding are important to those of us in the business of helping people on the move.

At last count, our state gained a total of 462,000 new residents during 2006, bringing our total population to around 37. 4 million. Half of the increase, however, was foreign immigrants (that we can count) and the other half, was from new births, mostly from new immigrants. According to the Department of Finance, California actually recorded a net loss last year of 67,000 people to other states. Since 2000, the state’s population has grown by 3.3 million people. We have had a net gain of 1.8 million babies born to residents and an increase of 1.4 million foreign immigrants but only a small 105,000 net gain of people moving to California from other states.

According to Bill Leonard, of the State Board of Equalization, “Middle income working families and retirees with pension income are leaving -- in droves. This is masked by the number of illegal immigrants and by the childbirths from those left behind. Federal census figures show that for the period between 2000-2004, the only state that had more domestic out-migration was New York, which is another high tax, high regulation state.”
More homeowners moving out of California than moving in? So what’s up with that?

Regionally, we are a higher growth area than the rest of the state. Sacramento reported an increase of 18,000 people last year. Placer County gained 9,000 souls and El Dorado County increased by 2,400 people. Not only did our population increase but according to Linda Gage, a Department demographer, our local counties gained new residents from other states unlike many other counties.

One factor that has allowed middle class homeowners to move out of state in such large numbers and prevented many potential homeowners from moving into the state is the high cost of housing. California homeowners are not moving because home prices are ratcheting down. They are moving because over the past five-years, home prices have ratcheted up so high allowing many sellers to capitalize on their increased values and move to a place with more affordable housing. California is experiencing a home equity deficit. We are exporting more home equity than importing.

In addition to high real estate prices, other factors are attributing to a net loss of middle-income families. There are now more alternative destinations. From 1945 to 1985, California was the primary destination for people moving west. Economic opportunities and quality lifestyle were more limited in other western states. Today, Las Vegas, Denver, Salt Lake and Phoenix have become major employment and/or retirement communities. The Internet also provides more destination choices. It’s now possible to work from home in Reno, with a client in San Jose, on a product that is manufactured in Detroit.

The evolution of movement continues to evolve and El Dorado County is directly in the path of one migratory wave. Over the centuries, the dominant motivations for moving have been primarily forced by wars and pestilence or greater economic opportunities. More recently, another primary reason for relocating appears to be developing. Safety and security are now primary reasons people are relocating to more rural counties. The resettlement of the mid-west, the urban flight, and the green movement are indicative of a new migratory movement.

Economic affluence and technology has provided more destination choices for movers as evident by the growth of rural counties. The net migration of middle class homeowners into California may be over but the relocation of Californians into El Dorado County seeking a higher quality lifestyle, including safety and security, will continue.


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