A Census data report released last week showed that migration rates across the United States plunged sharply in 2008 to levels that haven’t been seen since the Great Depression. For the period July 1, 2007 to June 30, 2008, the number of people migrating away from domestic metropolitan areas with populations of 1 million or more was 336,000, versus 688,000 people during the same period in 2005-2006, according to an expert’s analysis of the data. This represents a 50 percent decline in people moving out of urban areas, and that is significant.
Typically, domestic migration means people leaving the urban core for the suburban, exurban, and rural areas primarily because these areas offer cheaper housing and increased job opportunities. This is nothing new in this country, and such major cities as New York, Chicago, and San Francisco have experienced growth over the past few decades. And to former rust belt cities such as Cleveland, this is the norm. Phoenix, Las Vegas, and Tampa are examples of the new destination cities whose populations have increased many times over during the same period.
What’s happening is that our insecure economy has essentially frozen people from making the leap to a new place to live mostly due to job prospects everywhere are freezing. Another factor is real estate’s depressed prices. Very often people living in major cities cash in on their homes to move; however, these assets have taken such a big hit that people are just not selling. In other words, everybody is staying put until things in the market open up.
If this trend continues for a longer period of time, there is one untapped opportunity that can work if it’s approached in the right way. First, urban emigration has been blamed for a variety of ills leading to urban decay and blight. Looked at from this perspective, people not moving out in large numbers can lead to reinvigorating areas that have been overlooked. If the money isn’t moving out of the market, chances are that it will be spent in the market.
Another advantage of populations tending to remain in urban areas is that the cost of transportation and its impact on the environment will also be dramatic. As more people remain inside the urban core, mass transportation will be utilized more fully, greatly cut down the emission of greenhouse gases, and reduce the carbon footprint. This trumps suburban areas where the most common mode of movement is the automobile. Talk about unintended consequences.
There are many ways to look at these particular statistics— the idea is to open up our awareness and see how they can also be viewed in a positive light.
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· http://www.linkedin.com/in/rmrellc In addition, there will be an increase in migration as the geographic regional winners and losers sort themselves out. There will likely be increased migration from those individuals and families that are looking to retire or otherwise relocate from high cost of living areas to low cost of living areas, especially if they need to rely on reduced savings. People who didn’t use their homes to finance credit cards or other lifestyle expenses will eventually realize that they can still pocket substantial savings from the sale of their existing residence, even at today’s depressed pricing as they can make up the loss of opportunity on the sell side by substantial gains on the buy side; especially if they are stepping down in living style.
There will also be in migration into the large metropolitan areas by young people looking for opportunities. This is a great time to take a chance for young people not tied down with families and mortgages. Cost of renting will not likely ever be lower. Turmoil always begets opportunities for those who take the leap.
Finally, lack of current migration does not mean that there is not demand for migration. As that demand builds, it will likely lead to greater than typical migration when this bubble bursts.
In short, I believe that migration will actually increase as this cycle plays out. Just don’t ask me when.
Rob Mathes
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03/27/09 @ 11:58 
