Fewer than 12% of Americans changed homes in the past year, near the all-time low. But the reasons why people go or stay are changing.
Yesterday the Census released the Current Population Survey (CPS) data, giving an up-to-date picture on how many Americans are moving, how far they’re going, and why they’re making that move. The mobility rate remains at a low level: 11.7% of Americans moved in the year ending March 2014, unchanged from the previous period.
At this rate, the typical American stays put eight and a half years between moves. Remember the old rule of thumb that people move every seven years? Well, that was true until around 2003. In fact, the mobility rate has been falling for decades, as we pointed out in this post last year. Back in the 1950s and 1960s, Americans moved every five years on average. That rate rose to every seven years by the turn of the century and has since increased to the current eight-and-a- half year rate.
Here are the most recent mobility trends, based on this latest 2014 data.
The Long-Term Mobility Decline Continues
With the percentage of Americans moving stuck at 11.7% in 2014, mobility remains near the all-time low of 11.6% in 2011. That’s considerably below the 14% rate from the early 2000s. The housing bust and recession offer possible explanations why people are stuck in place – things like negative home equity and few job opportunities to move for. Still, mobility also declined both before and during the housing bubble. Furthermore, mobility has barely budged since 2011 despite a significant drop in the percentage of borrowers with negative equity and a modest recovery in the job market.
What explains this long-term decline in mobility? Some academic researchers have found that the economic benefit of switching jobs has fallen over time. Since a job is often the reason people move, that means the economic benefits of moving have fallen. In fact, the decline in mobility has mostly been a drop in longer-distance moves, that is, moves to a different county. Moves within the same county have stayed relatively steady since 2000.
Why People Choose to Stay or Go is Shifting
The reasons why Americans move – which we think is one of the most fun questions asked in any Census survey – have changed over the course of the boom, recession, and recovery. During the boom, compared with the period after the bubble burst, more people moved to have a new or better home, or because they wanted to own instead of rent. By contrast, during the recession, the percentage of people who moved for cheaper housing went up.
Most recently, in the year ending March 2014, the percentage of people who moved because they wanted a new or better home or apartment increased. But the percentage of people who moved for cheaper housing also increased, though it didn’t return to its level in 2009, 2010, and 2011, when more people moved for cheaper housing than for a new job.
Continued economic recovery should boost the number of Americans who move for a job. At the same time, more homeowners are getting back above water into positive home equity, and that should also increase mobility. Yet, rising home prices and higher mortgage rates might mean that more people move in search of cheaper, rather than new or better, housing.
To see the full article, including more details about the data and analysis, click here.