The desire for affordability appears to have been one of the driving forces behind Californians' exodus from the state over the last decade, as many relocate to surrounding states where homeownership may be more within reach, according to new studies.
This sentiment has been echoed in headlines and by politicians as younger Californians struggle to become homeowners, driving many to seek new housing opportunities elsewhere.
A study published by the California Policy Labfound that Californians who left the Golden State were "more likely" to become homeowners within seven years of moving than their counterparts who stayed.
This was largely due to the lower costs of the new neighborhoods.
"Many Californians who move out of state relocate to significantly more affordable communities and often see higher rates of homeownership," the study reads.
On average, homeowners saw a nearly 48% drop in home values in their new neighborhoods, from a median home value of $826,000 to $430,000. Even as many households saw their incomes drop by about 8% or about $340 a month on average, the report found that this was "a tradeoff" that was "far outweighed by the lower costs of living."
In the early 2010s, a Californian earning the median household income, about $58,000, could qualify for a mortgage on a mid-tier home; however, that same income "falls substantially short" to qualify for "even a bottom-tier home" in recent years, according to the report.
Additionally, the study found that the average Californian who relocated to a new state saw their monthly housing costs drop by about $675, for both homeowners and renters.
"Perhaps because of these lower home prices, homeownership is also more common in their new neighborhood, where 60% own their homes, compared to 53% in the California neighborhood they left," the report reads.
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Although it might be assumed that lower-income Californians would be the ones seeking affordability, the California Policy Lab found that the average household leaving the state was "not poor" and lived in a "more affluent" neighborhood.
The study found that, on average, individuals who left California were not able to "keep up with the Joneses," and had worse financial health compared to their neighbors.
The data showed that California "exiters" had, on average, a credit score about 17 points lower than their neighbors, owed more on student and car loans, and had a higher credit card utilization rate, according to the study.
"All these signals are consistent with the idea that exiters desire a quality of life that they cannot achieve in their old neighborhood," the report reads.
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Additionally, a similar study released by thePublic Policy Institute of Californiafound that the state saw a spike in the number of college graduates and higher-income household adults who moved out during the pandemic.
"The losses of college graduates and higher-income households are likely related to the ability of many highly educated and highly paid workers to work from home," according to the Public Policy Institute of California study.
"Over half of higher-income Californians leaving the state during the pandemic reported working from home."
Over the last decade, California has seen a net loss of about 165,000 higher-income adults and 75,000 college graduates among the almost 10 million people who moved from California to other states, according to the Public Policy Institute of California.
"Their departures are still relatively small in proportion to their shares in the state as a whole," the PPIC report reads.
Where are people moving to?
Regardless, both studies found that people's main reason for leaving the Golden State was the "high housing costs."
Although many may assume that most Californians would have relocated to either Texas or Florida, the California Policy Lab study found that a large share moved to Nevada and surrounding states.
"Californians most often leave for nearby states, and California also welcomes new residents from neighboring states most frequently," reads the California Policy Lab study.
Nevada, on average, received about 226 Californians per 10,000 residents each year between 2016 and 2025, according to the report.
The next four states with the highest migration flow from California were Hawaii, Oregon, Arizona, and Idaho, according to the report. Texas was ranked 11th among the states that Californians had decided to move to. Notably, Massachusetts was the only state among the top 20 in which California saw a net inflow of people.
The California Policy Lab study also found that more affluent Californians tended to move farther away.
"During the pandemic, the average mover from the highest-income California neighborhoods relocated 449 miles away — two and a half times as far as the average mover from the lowest-income neighborhoods," the report reads.
Noe Padilla is a Northern California Reporter for USA Today. Contact him atnpadilla@usatodayco.com, follow him on X @1NoePadillaor on Bluesky @noepadilla.bsky.social.Sign up for theTODAY Californian newsletteror follow us on Facebook atTODAY Californian.
This article originally appeared on USA TODAY:Californians are leaving for affordability. Study shows where they go
