Ahhh … autumn. This is my favorite time of the year. The brutal summer is over, there is less yardwork, and football is in the air. I also love Thanksgiving because it’s rich with history and faith, it’s family oriented, you can expect a large meal, and there is … well … football. It helps that my family generally stays home for Thanksgiving, because, while it’s great to see extended family, travel can be a little stressful, especially during one of the most traveled weeks of the year. While we like to stay home at Thanksgiving, autumn means many species of birds are packing their bags for warmer climates. Approximately 1,800 of the world’s 10,000 bird species migrate. It is not fully known what drives these creatures to embark on such a journey, but it is generally believed to be availability of food, habitat, and weather. According to National Geographic, the compulsion is so strong that it leads the bar-headed goose to fly 5,000 miles over the Himalayas from Mongolia to India. During the mountain stage, the geese fly as high as 29,000 feet and make it over the mountains in a single eight-hour hop. This makes them the world’s highest flying species (though vultures have been known to reach 30,000+ feet, but not regularly and only by soaring on an updraft).
Bar-headed geese, Photograph by Darlyne A. Murawski, National Geographic
The longest distance migration is believed to be by the Arctic Tern, which travels over 9,000 miles from its arctic breeding grounds in the north to Antarctic non-breeding areas in the south, and back again … every year. That distance would be “as the crow flies” – pun intended – but they take such a zigzag route that some end up flying 44,000 thousand miles roundtrip to take advantage of prevailing winds, weather, and food sources. If you think about the seasonal differences between the northern and southern hemispheres, it is always summer for the Arctic Tern who sees more daylight than any living creature. Lastly, the award for longest flight during migration goes to the Bar-tailed Godwit, which is known to fly 7,000 nonstop miles from Alaska to New Zealand. It can travel nine days without food, rest, or water, and it loses more than 50 percent of it’s bodyweight during the journey. It is able to enter some sort of sleep-state while flying, and it apparently uses the sun and stars to navigate. THAT is impressive.
Of course, humans tend to migrate too, but trends are generally over longer periods of time and in one direction. During the industrial revolution from the 18th to 19th century there was a huge population shift from the country to the cities. In 1800 only 5 percent of the U.S. population lived in cities, but this number grew to almost 50 percent in 1920. Today it is 80 percent. As for the southwest, road building and dam construction in the mid 1900s literally paved the way for increased economic opportunity in the desert regions, and growth of the military/industrial complex during and after World War II brought many workers to the region. Of course, numerous people move to this region for the warmer climates and the quality of life. Over the last 90 years, population in the southwest United States has grown 1500 percent, compared to 225 percent growth for the nation as a whole.
Arizona has certainly benefited from both these trends over the years (urbanization along with southwesterly migration), as its population growth since 1920 is outpaced only by Nevada. Locals know that we get much of our growth from California. This is largely due to Arizona’s more business-friendly environment and lower cost of living. Since the recession, however, there have been some notable changes in state-to-state migration patterns. The table below shows the top net population changes within the U.S. from 2005 to 2007.
As we were coming off the highs of the last growth cycle, the net flow of population from California to Arizona was second only to the New York to Florida pattern (this excludes international migration along with population change due to births/deaths). It is apparent from the table above that New York and California are having a hard time keeping people. During this period, for instance, for every 2 people that went to California from Arizona, 5 went the opposite direction. Much of California’s outflow is economic in nature, while New York’s outflow is characteristically due to the retiring population. As you might have guessed, though, the patterns and figures have changed since we reached the depths of the recession. The table below shows the net population flow between states from 2007 to 2009, recently updated by the Census Bureau.
Note several changes in the top ten, including the outflow of population from Florida to states like Georgia and North Carolina. Also, Texas’ relative economic stability led strong population flows to the Lone Star state, especially from California and Florida. Note furthermore the smaller numbers compared to the previous table, as mobility has been greatly reduced due to either homeowners’ inability to get out of their current residence or lack of economic opportunity in other states. Contrary to popular belief, America’s populace has become less mobile over recent decades, but this trend fell to new lows during the Great Recession.
As for Arizona, the table below shows the top ten states from which we got most of our population flow from 2007-2009. California is easily number one, but the flow declined by 60 percent compared to the 2005-2007 period. It is apparent that we are dependent on this west coast growth for economic expansion. Interestingly, migration from Minnesota and Washington (among several other states not shown) actually grew, but the numbers are not particularly significant. Basically, while Arizona continued to have a net positive flow of population from other states, net migration growth went down by 46 percent from nearly 100,000 in 2005-2007 to a little over 50,000 from 2007-2009. This decline was dominated by the change in the net flow of migrants from California, accounting for two-thirds of the change.
So what does the future hold for Arizona? Will we get back to previous growth rates, particularly from California? In a recent New York Times article, William Frey of the Brookings Institution predicted that relocation rates will pick up, especially for young adults, when new housing and job opportunities begin to reappear. While people are staying put with a wait-and-see approach to the economy, “There is going to be pent-up demand for migration,” according to Mr. Frey. Agreed. Despite what appears to be slightly negative population migration in Arizona for 2009 and 2010, the table is being set for a return to typical migration patterns. The Phoenix area is adding jobs and the unemployment rate is declining steadily. Resale inventory is tightening up across the U.S., and home prices are stabilizing, even in Phoenix. Households are itching to move on to greener pastures. I am not predicting a huge wave of new population in the short term, but if we can start 6,000 units with no population growth, even a trickle of new migrants will impact the homebuilding industry next year. In my mind, the new home market will surprise the industry to the upside in 2012. While we look up and see migrating birds this autumn, next year – if we look laterally – we’ll start to notice a few more moving vans.
BACKGROUND
Ben Sage, Director of Metrostudy’s Arizona Region, has been researching and analyzing housing markets for seventeen years. He has prepared hundreds of market studies in various cities around the country for numerous product types. His knowledge and experience combined with Metrostudy’s accurate and reliable information have enabled Ben to advise many Arizona real estate firms in their risk assessment, decision making, and strategic planning. Ben has also been a resource for such publications as the Arizona Republic, East Valley Tribune, Phoenix Business Journal, Inside Tucson Business, Arizona Daily Star, Arizona Builder Magazine, Bloomberg News, and the Wall Street Journal. He can be reached at (480) 756-9300, option 3 or bsage@metrostudy.com, or visit www.metrostudy.com.
