Projections put U.S. migration between 14 million and 23 million moving by the end of 2021, with 47% of prospective movers saying the deciding factor was seeking areas with a lower cost of living. 

As a result, people moved to more suburban and rural areas, with 82% of urban centers experiencing a decrease in population. The top 5 most fled states in 2021 were New Jersey, Illinois, New York, Connecticut and Kansas. According to the Missouri Economic Research and Information Center, three of these five states: New Jersey, New York and Connecticut, rank in the top 12 states with the highest cost of living. Additionally, 65% of Illinois residents live in the Chicago-metro area, which is 23% more expensive than the average in America. Consequently, many of the states with large increases in migration, such as Arkansas, Tennessee, Alabama, North Carolina, South Carolina, and Wyoming, have below average cost of living compared to the rest of the United States.

With the rise of remote working following the COVID-19 pandemic – 26% of people worked entirely remotely throughout 2021 – employees now have the ability to leave large metropolitan areas for less expensive areas, while still earning what they would in cities. 

According to a study conducted by Zillow, people on average were moving to homes that were $27,000 less expensive than their previous home. The study also found the new homes averaged 33 square feet larger than movers’ previous homes. Additionally, research by MarketWatch showed that people are leaving cities for suburbs and rural areas at a rapid rate. Researchers attributed the phenomenon to an expected “hybrid work model” as a result of adaption of employers and employees to remote working environments and capabilities.

Simply put, people are leaving expensive urban areas for cheaper and more spacious suburban and rural areas. The long-term impact this will have on the housing market is unknown, but changes are coming soon.