January 20, 2010

Arun Barman, Research Economist 

Understanding population flows within a state or region can help REALTORS® better understand trends in the housing market. Changes in statewide population are a result of either natural growth (births minus deaths) or through migration (international and domestic). Despite the economic downturn that has plagued the housing market, population continues to rise through more births than deaths and migration from abroad. Overall, the rate of growth in the U.S. was 0.86%. The Census Bureau computes population estimates as well as the rates of change of the different components of population change. This data allows for some interesting state-to-state comparisons. Also, it comes out in a more timely fashion than other Census data products which often lag the market by years.  Click here for more information >

Despite a deep recession, some states still had considerable population growth. Wyoming, Utah, and Texas were the biggest population gainers with growth of more than 2 percent between July 2008 and July 2009. Michigan and Maine each actually saw population loss over the same period. Colorado and D.C. also saw strong population growth. The D.C. market has been helped by stronger federal spending leading to a more stable job market than other parts of the country.

 

Looking back over the decade, Nevada, Arizona, and Utah all grew by more than 20 percent, while Michigan and Rhode Island grew by less than one percent. The growth of cities like Las Vegas and Phoenix has contributed to the population growth of their respective states. Louisiana's population numbers suffered in part as a result of Hurricane Katrina, and Michigan's growth was stunted by continued job losses in the automobile industry.

 

The following statistics deal with growth rates per 1,000 people which allow comparisons between states; and should not be confused with absolute numbers. Looking at the birth rate in a population for instance may show which states tend to have a higher rate of household formation.

A large part of the high population growth rate in 2008-2009 in Utah and Texas can be attributed to a high birth rate in those states. Idaho, Alaska, and Arizona also were among the top five states in terms of births per 1,000 people. Vermont, Maine, and New Hampshire ranked at the bottom of the list.

Migration rates are also interesting to look at in gauging home buyer demand. There are two types of migration that the Census Bureau's statistics track: international and domestic. Both types are important to consider when anticipating demand in the home buying market as people often look to purchase new homes when moving to a new area. Florida, California, New Jersey, Nevada, and Arizona lead in terms of international migration rates. In absolute numbers, California had by far the most international migrants followed by Texas and Florida.

In terms of domestic migration, Wyoming, D.C. and Colorado had the highest rates. In absolute numbers Texas had the largest number of domestic migrants followed by North Carolina. Michigan had the most negative rate of domestic migration, that is, the largest. In absolute numbers, California, New York and Michigan had largest number of people leave the state via domestic migrations.

 

Regionally, the West and South have the highest population growth. Higher birth rates in both help contribute, as well as positive domestic migration. The West and the Northeast have the strongest international migration rates. The Midwest suffers from a negative net migration.

1: Components of State Population Change, Source – Census Bureau

 

 

This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >

 

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