The clock is ticking now, 26 days and counting to Super Bowl XLVIII, which means it's 31 days to Spring Selling 2014. Between now and then, it may be that sales pace holds up in warmer, second-home, and active adult markets among discretionary buyers not encumbered with a contingency sale to complete before they spring for a new home acquisition. Traditionally though, the weekend post Super Bowl marks the moment builders get their "yay" or "nay" signal from a buyer populace who vote with their feet.
Meanwhile, land committee may be a surreal meeting for the next few weeks. Amid the grip of icy polar air and the ritual culmination of the National Football League season over the next couple of weekends, a true reading on sales volume and pace may be hard to come by. One would hope that strategies put in play a year ago or more will play out successfully in the early-going of 2014's Spring Selling Season.
This doesn't mean that the appetite for fresh insight into where the next opportunities might crop up, or affirmation of a land acquisition strategy already in place isn't always welcome. So, we figure that as Allied Van Lines andUnited Van Lines both release annual data on originations and destinations for their clients' interstate moves, let's take a look at insight into post-recession migration trends.
Here's a comment from ISI Housing's Stephen East on the United Van Lines annual study:
The data is quite telling. Generally, those states with business friendly environments and energy complexes did quite well, while those states leaning ever-more toward high taxes and socialist agendas did worse. The data also highlights the specific impacts of issues like the dying coal-mining industry and government defense cutbacks.
See the list below for the Key-Takeaways from the Annual Migration Study:
The Top Inbound States of 2013:
1. Oregon (61% of the moves were inbound). Likely drawing people from California.
2. South Carolina (60% Inbound). Has been on "high" inbound list 16 of the past 18 years. Likely low cost-of-living and good climate.
3. North Carolina (58% Inbound). Has been on the "high" inbound list every year since 1993. Banking Sector healing, healthcare strong.
4. District of Columbia - (57% Inbound) Fell to the #4 position after 5 consecutive years as the top moving destination. Surprising DC remains on the Inbound list given the sequestration cuts in 2013. Testament to the fact that Government never shrinks, just slows its growth.
5. South Dakota (57% inbound). Energy boom creating jobs.
6. Nevada (56% Inbound). Likely drawing people from California.
7. Texas (56% inbound). Energy boom creating jobs, low cost of living, favorable taxes and business environment.
8. Colorado (55% Inbound). Energy boom creating jobs.
The article mentions business incentives, industrial growth and relatively lower costs of living are attracting jobs and people to the Southeastern and Western states such as South Dakota, Colorado and Texas. Additionally, the amenities (public transit, green space, local arts) in the Pacific Northwest are drawing young professionals and retirees.
The Top Outbound States of 2013:
1. New Jersey (64% Outbound). Top outbound state in 3 of past 4 years. High taxes and high cost of living driving people away?
2. Illinois (61% Outbound). Remained at #2 spot after falling from top spot in 2011. High taxes and high cost of living driving people away? Government dysfunction in spades. $100B Pension shortfall. 4 of the last 7 governors went to prison.
3. New York (61% Outbound). High taxes and high cost of living driving people away?
4. West Virginia (60% Outbound). Coal industry dying.
5. Connecticut (59% Outbound). High taxes and high cost of living driving people away?
6. Utah (58% Outbound).
7. Kentucky (56% Outbound). Coal industry dying.
8. Massachusetts (56% Outbound). High taxes and high cost of living driving people away?
9. New Mexico (55% Outbound). Likely Defense related.
The Northeast is the most prominent region on the high-outbound list. NVR, and to a lesser extent TOL, are the most levered public builders to the Northeast.
Meanwhile, National Association of Home Builders economics department denizen Joshua J. Miller takes a look at the decline in the percentage of population moving, a steady trend downward since the mid-1980s accentuated by the recession in the late part of the decade past.
Miller spotlights insight on the younger adult set and what they're up to:
Between 2012 and 2013 the mover rate for those 25 to 29 years was 23.2%. According to the Census, the most common discernible reason for moving between 2012 and 2013 for those between 25 and 29 was to establish own household at roughly 14.2%. The next distinguishable category of movers at 13.9% did so to new or better housing.
It may be worth noting that although the percentage share of movers and mobility may decrease as a huge swath of the U.S. ages, the absolute numbers are significant enough to support a lift in the market.
Here are a couple of key links from the nation's migration meister Brookings Institution fellow William Frey on the topic of mobility trends and the reasons for them.
One speaks to post-recession mobility recovery, with lumpiness in some markets that also show up in the Allied and United Van Lines studies.
The other focus from William Frey is on the growing disparity in migration trends between younger and older adults.
As a parting thought, here's insight into the limitations in helpfulness of all of the above. What succeeds for you in 2014 and 2015 won't likely be because every project in a growing metro area gets a profit lift from a rising tide. As Metrostudy regional director Austin Evans points out, it's site specific insight that helps a land acq pro know about whether a deal pencils or not for a builder's program, not broad-brush metro data.
But while it's cold outside, it's good to get a first-blush look at where people are going.
Learn more about markets featured in this article: Austin, TX.