The “Texodus” Migration: Over 100K Made the Switch in 2021

While Florida remains the most popular destination for relocating buyers, the ongoing migration from pricey California metros to relatively affordable ones in Texas has grown by 80% since 2012. And nearly half of them are high-income millennials.

That’s according to a new report from StorageCafe that highlights the benefits for both homeowners and renters migrating from California to Texas. 

Elon Musk is even building his own town near Austin. And the number of celebrities leaving the Golden State for a slower life in Texas is only growing. 

Sure, some people are moving in the opposite direction—about 33K in 2021. But in the same year, over three times as many (111K) made the switch from California to Texas. That works out to an average of 300 people per day leaving California taxes behind them. 

And with the savings in housing costs alone, it’s not hard to see why. 

Affordability and job options are leading factors in the migration

Affordability and job options are the main drivers behind the migration from California to Texas. 

A major contributor to the Lone Star state’s relative affordability is its no-income-tax policy, which saves homeowners and businesses a substantial amount each year. 

Former Californians move to thriving Texas metros to enjoy a lower cost of living, abundant job opportunities, friendlier housing markets, and larger living spaces. Single-family homes in Texas are roughly 17% larger than those in California. Utilities are also roughly 20% cheaper in Texas. 

Businesses are also relocating to take advantage of a more business-friendly environment, with over 100 companies moving their operations to Texas since 2020—with 40% of them relocating from California. 

Millennials with above-average incomes are leading the migration

Nearly half (46%) of the people moving to Texas from California are millennials, with Gen X next in line, representing 21%, followed by Baby Boomers and Gen Z. 

It’s also worth noting that the typical household income for the millennials making this move is $114K per year—21% higher than what millennials earn on average across the U.S. ($94.K).

Most of these California millennials head straight for Austin, Houston, and Dallas, drawn by job opportunities in the tech, finance, and healthcare fields. Austin, in particular, has a thriving tech scene, with big players like Dell, Google, Apple, and Oracle competing for top talent.

And after bailing from California over frustration with its COVID restrictions, Elon Musk is building his own town near Austin to house his Boring Co., Tesla, and SpaceX employees. 

Moving from San Jose to Dallas can save home buyers $1M

Homebuyers moving from California to Texas can save a considerable amount of money, though the difference varies by migration route. On average, homes in Texas cost about $282K less than California homes, saving buyers about 70% on their home purchases. 

With some migration routes, buyers can save over twice that and up to nearly four times as much. 

Here are the top 10 most common relocation routes: 

1. San Jose to Dallas (with median home price difference of 258% or $1,056,939)
2. Redwood City to Austin (243% or $1,274,000)
3. Los Angeles to El Paso (207% or $592,530)
4. San Jose to Georgetown (185% or $951,939)
5. San Jose to Austin (179% or $941,939)
6. Martinez to Beaumont (171% or $536,055)
7. Los Angeles to San Antonio (166% or $548,500)
8. San Diego to San Antonio (163% or $539,268)
9. Santa Ana to Houston (160% or $646,510)
10. Santa Ana to Dallas (156% or $640,000)

Moving from L.A. County to Collin County can also get transplants an extra 1,055 square feet or 62% more living space, on top of the cost savings. 

For now, at least, Texas offers more affordable housing options than California. But buyer demand is putting additional strain on the housing market, especially in the most popular locations, driving up home prices and shrinking the cost savings gap. 

According to recent Zillow data, the median home price in Texas has gone up by 54% in the last five years, while, during the same period, California’s has increased by 42%. 

That said, Texas is still an attractive option for buyers seeking a more relaxed housing landscape in an area with loads of amenities and a thriving job market. Plus, some of those taking the more popular routes can save an eye-watering amount of money on a larger home. 

As for renters, most Californians moving to Texas can save over $1,000 per month on rent. 

Read the full report on StorageCafe for more details. 

Takeaways for real estate agents

Whatever you think of the term “Texodus,” the mass migration from pricey West Coast metros to more affordable ones has been an ongoing theme for the U.S. housing market. And buyers as well as sellers need help sorting through the latest headlines. That’s where you come in. 

Be the resource that clears the fog and helps them navigate the market with confidence.