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This is a fascinating study by Issi Romem about the characteristics of cross-metropolitan migration in the United States. The key findings are that in-migrants to expensive coastal cities tend to have higher incomes and more education than the out-migrants, and that the opposite is true for the less expensive cities in the US. “Expensive” means expensive housing.
Here is the income chart:
Let’s use San Francisco as the example since it’s the most expensive metro (all the way to the right on the x-axis). The way to read this is that on average, from 2005 to 2016, in-migrants to the San Francisco metro area earned $12,640 a year more per household (y-axis) after they arrived compared to out-migrants before they left. This chart shows the difference between in and out incomes.
Take note of Miami which is sitting at a similar place to New York and Los Angeles on the horizontal income line, but has home values similar to Phoenix, Chicago, and Philadelphia.
Now here’s the education chart:
Similarly, it is showing the difference in educational attainment between in and out migrants.
So what does all of this tell us?
Well, it tells us, among other things, that US metros are continuing to sort based on income and that this process of polarization is probably contributing to home price appreciation. Because even if the incomes of current residents aren’t growing, these “expensive cities” are effectively swapping out poorer residents for richer ones. That, alone, would mean more money for expensive homes.
For Issi Romem’s full article, click here.
One of the reasons New York is the city it is today is because of the superiority of its port. For a number of reasons, which are better explained here by urban economist Edward Glaeser, New York was almost destined to become “America’s port.” Of course, this phenomenon is something that has been repeated all throughout history. Being connected to the right body of water, in the right way, has meant all the difference in terms of economic success.
But with study after study demonstrating that our economic success is leading to severe climate change and to the melting of arctic ice sheets, those very same port cities are now being put at serious risk. How ironic. Hurricane Sandy was the largest storm surge in the history of New York. Prior to it occurring, the likelihood of such a storm would have been calculated at 0.1%. It was greater than a 1,000 year storm.
But if the research is correct, we’re going to see more storm surges and we’re going to see rising sea levels. This makes many, if not all, sea port cities a high risk zone for flooding, which is why cities, such as Boston, have prepared comprehensive reports on how to manage a rising tide. From adjustable parapet walls to multipurpose green spaces that can absorb excess water levels, cities around the world are looking for solutions.
But these are merely reactive solutions.
What need to also be looking at is how we can fundamentally improve our economy so that we’re operating in a sustainable way. Some of the research suggests that what we’ve done is irreversible, but that doesn’t mean we should continue to make it any worse. Part of the issue with this “wicked problem” is that it doesn’t seem immediate to most people, yet. It’s too easy to ignore. But that doesn’t mean it doesn’t exist.
Image: This Big City
This is a fascinating study by Issi Romem about the characteristics of cross-metropolitan migration in the United States. The key findings are that in-migrants to expensive coastal cities tend to have higher incomes and more education than the out-migrants, and that the opposite is true for the less expensive cities in the US. “Expensive” means expensive housing.
Here is the income chart:
Let’s use San Francisco as the example since it’s the most expensive metro (all the way to the right on the x-axis). The way to read this is that on average, from 2005 to 2016, in-migrants to the San Francisco metro area earned $12,640 a year more per household (y-axis) after they arrived compared to out-migrants before they left. This chart shows the difference between in and out incomes.
Take note of Miami which is sitting at a similar place to New York and Los Angeles on the horizontal income line, but has home values similar to Phoenix, Chicago, and Philadelphia.
Now here’s the education chart:
Similarly, it is showing the difference in educational attainment between in and out migrants.
So what does all of this tell us?
Well, it tells us, among other things, that US metros are continuing to sort based on income and that this process of polarization is probably contributing to home price appreciation. Because even if the incomes of current residents aren’t growing, these “expensive cities” are effectively swapping out poorer residents for richer ones. That, alone, would mean more money for expensive homes.
For Issi Romem’s full article, click here.
One of the reasons New York is the city it is today is because of the superiority of its port. For a number of reasons, which are better explained here by urban economist Edward Glaeser, New York was almost destined to become “America’s port.” Of course, this phenomenon is something that has been repeated all throughout history. Being connected to the right body of water, in the right way, has meant all the difference in terms of economic success.
But with study after study demonstrating that our economic success is leading to severe climate change and to the melting of arctic ice sheets, those very same port cities are now being put at serious risk. How ironic. Hurricane Sandy was the largest storm surge in the history of New York. Prior to it occurring, the likelihood of such a storm would have been calculated at 0.1%. It was greater than a 1,000 year storm.
But if the research is correct, we’re going to see more storm surges and we’re going to see rising sea levels. This makes many, if not all, sea port cities a high risk zone for flooding, which is why cities, such as Boston, have prepared comprehensive reports on how to manage a rising tide. From adjustable parapet walls to multipurpose green spaces that can absorb excess water levels, cities around the world are looking for solutions.
But these are merely reactive solutions.
What need to also be looking at is how we can fundamentally improve our economy so that we’re operating in a sustainable way. Some of the research suggests that what we’ve done is irreversible, but that doesn’t mean we should continue to make it any worse. Part of the issue with this “wicked problem” is that it doesn’t seem immediate to most people, yet. It’s too easy to ignore. But that doesn’t mean it doesn’t exist.
Image: This Big City
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