Americans are moving a lot less — and boomers may be to blame

• US internal migration has significantly slowed over the last five decades.
• Local home prices influence older homeowners in expensive states less than in past decades.
• Despite wages encouraging migration, housing-related factors have significantly offset this.

Fewer Americans are moving within the US, and boomer homeowners in more expensive states may explain why.

In a new working paper, economics professors William Olney and Owen Thompson at Williams College determined that residents of states with high home prices, such as California and New York, have become less likely to move as a result of those high prices. The researchers argued older homeowners primarily drove this decline in internal migration.

"The decline in internal migration appears to be primarily driven by the migration decisions of older homeowners in expensive urban states becoming less responsive to local home prices," the researchers wrote.

Over the last few decades, US internal migration has fallen substantially. Census data shows internal migration has slowed since the 1970s amid deindustrialization and a weaker economy.

"This suggests that declining internal migration is due to changes in structural aspects of migration choice, which affect individuals and families of many different backgrounds," the authors wrote.

Zooming out, the researchers noted that people tend to migrate from the Northeast, Midwest, and California to the Northwest, Southeast, and Southwest. Net migration has been strongest out of California, Illinois, Massachusetts, New Jersey, and New York, which have relatively high wages and housing prices.

Net-positive states like Georgia, North Carolina, Tennessee, and Texas often have lower wages and housing prices. Still, the inflow rate for Sun Belt States, though still much higher than most other states, has declined most rapidly over the 23-year period.

The researchers used IRS administrative data to determine why migration has fallen. They analyzed wage and housing price gaps between regions around big cities and found that higher wages tended to attract movers from lower-wage areas, while places with lower housing prices tended to bring in people from more expensive places.

More specifically, a 10% increase in the origin wage correlates to a 3.5% decline in migration as people are more inclined to stay in areas with abundant high-paying jobs. When wages increase by 10% in the destination CZ, migration increases by 7.8%.

Regarding housing, migration rises 1.4% when origin home prices rise 10%. When destination home prices grow 10%, migration falls 2.6%.

The researchers then developed a model for predicted overall national migration rates based on the city-to-city differences in wages and home prices, with those two factors alone accounting for about a third of moving flows.

The researchers found that wages on their own could have pushed movers to migrate more frequently, given that migration decisions are increasingly sensitive to destination wages. However, housing-related factors have more than offset wages and moving decisions are becoming less influenced by home prices in their current location.

"In particular, migration has become much less responsive to housing prices in the origin CZ, such that many households that would have left in response to high home prices several decades ago now choose to stay," the authors write.

The researchers found that states with high housing prices, including California, New York, and New Jersey, experienced the greatest declines in sensitivity to origin home prices. Meanwhile, renters, college graduates, and younger people are becoming slightly more sensitive to origin home prices.

"For instance migration is significantly less common among homeowners, older individuals, parents, and those that are employed, while it is significantly more common among the more highly educated," the researchers write.

Older homeowners also experienced these declines most profoundly. The researchers suspect this is because homeownership is common later in life, adding that older Americans are less likely to hold a college degree. These homeowners are less likely to move or retire when home values increase in their current location compared to 30 years ago. Many boomers are moving to Florida, Nevada, and Arizona, according to a SmartAsset analysis.

According to census data, almost 20% of Americans moved each year between the mid-1940s and the 1960s, most of which were short moves. Meanwhile, in 2022, the overall national migration rate was just 12.6%, according to census data. Many are moving less given the robust job market that has brought higher-paying jobs across many sectors to many corners of the country. Still, bigger moves, such as cross-country moves, are increasing.

A Redfin analysis from January of Census Bureau data found that in 2022, empty-nest boomers owned 28% of US homes with three or more bedrooms. This is about double the 14% share owned by millennials with kids. Many boomers are clinging to their homes and have little financial incentive to downsize.