Tuesday, February 27, 2024

Miami-Dade’s Out-of-State Homebuyers Earn Nearly $100K+ Median Household Income

By Gay Cororaton, MIAMI REALTORS® Chief Economist

Out-of-state homebuyers relocating and purchasing South Florida real estate has significantly increased since 2019. South Florida’s growth as a fintech hub, low taxes, pro-business government, all-year sunny weather, reduced Covid restrictions, the global expansion of remote work and more have led to a surge of South Florida homebuyers from high-taxed, high-density states.

In 2021, Florida had the largest net domestic and international migration of persons during April 2020-July 2022, totaling 800,000. Nearly 120,000 people moved into the counties of Miami-Dade, Broward, Palm Beach, and Martin in 2021, or 17.9% of the 669,311 persons who moved to Florida (16.6% in 2019), according to U.S. Census Bureau data.[1]

In 2022, more than 583,200 people exchanged their out-of-state licenses for a Florida license in 2022, 28% higher than the average of the previous six years and 36,200 more than in 2021[2].

What are the characteristics of top out-of-state buyers moving into Florida and what is the implication for the South Florida housing market during this time of rising mortgage rates but also long-term?

Using microsample data from the American Community Survey in 2021 (ACS PUMS), here are the insights we derive:

  • South Florida attracts movers from across the U.S., but largely from New York, New Jersey, and California.

 

  • Half of households who moved from the top states of origin of household movers typically earn more than the median household income compared to the county median income. Higher income buyers are better able to afford the increase in mortgage rates, which mitigates somewhat the negative effect of rising mortgage rates on affordability, especially for lower income households. The development of a mix of housing that caters to both high-income and lower income families will help sustain migration into South Florida.

 

  • Miami-Dade tends to attract households with a single member, Broward tends to attract younger families, and Palm Beach and Martin County tends to attract retirees. With millennials still reaching the homebuying age until 2040 and with baby boomers continuing to retire, South Florida’s housing demand will be supported over the long-term by these two large groups of buyers. Multifamily buildings to own or rent are likely to be in demand in Miami-Dade while single-family housing is likely to be in higher demand in Broward.  Senior living communities and housing is likely to be the main growth area in Palm Beach and Martin.

 

  1. New York, New Jersey, California: Top state origins of households who move to South Florida

 

In 2021, about 53,652 households moved from other states to the counties of Miami-Dade, Broward, Palm Beach, and Martin.[3] Miami-Dade accounted for 35%, Palm Beach at  34%, Broward at 27%, and Martin, at 4%.

Households from New York, New Jersey, and California accounted for 42% of out-of-state households who moved to South Florida in 2021. In Martin County, households who moved from New York made up 42% of out-of-state households who moved.

  1. Mix of young and old, married and single households move to South Florida

 

Miami-Dade and Broward tends to attract younger persons compared to Palm Beach and Martin County who tend to attract older persons, likely retirees. In Miami-Dade, 49% of persons who moved from out of state were 25-44 years old, 36%  of movers in Broward, 27% in Palm Beach, and 17% in Martin.  In Martin County, 39% of households who moved were 65 years old and over.

Multifamily buildings to own or rent are likely to be in demand in Miami-Dade while single-family housing is likely to be in higher demand in Broward.   Senior living communities and housing is likely to be the main growth area in Palm Beach and Martin.


By type of family,  Miam-Dade tends to attract single households, with 44.3% of households who moved as single-person households. This indicates a demand for owned or rental housing in multifamily buildings. Broward tends to attract families with children under 18, making up 14.3% of households who moved, the largest share among the four counties. In Palm Beach and Martin, the largest share of households were married couple with no children under 18, making up 30.4% and 42.7% of households who moved, respectively.


3. The median income of households who moved from other states was higher in about half of the states compared to the median household income of the county

 

Households who moved to South Florida comprised a mix of  buyers across the income spectrum. For example, in Miami-Dade, the median income of households who moved to Miami Dade County in an owner-occupied home with mortgage, at $97,300, is higher than the median income of all households with a mortgage in the county in 2021, at $86,318. However, in Broward County, the median income of households who moved into owned home with a mortgage is lower, at $91,000, compared to the median income of all households with a mortgage in the county, at $95,433.[1]

Comparing the median income of households who moved to Miami-Dade,  the median income among households who moved other states was higher than the median income for that county ($59,044) in 50% of the states, with the median household income at over $100,000 among the largest set of movers like  New York ($185,000),  Virginia ($119,000), and New Jersey ($142,000).

In Broward,  the median income among households who moved other states was higher than the median income for that county ($65,747) in 52% of the states, with the median household income at over $100,000 among the largest feeder states such as New Jersey ($116,000), California ($105,000), Illinois ($117,000), Indiana ($123,000), Virginia ($154,000), Maryland ($142,000), and Ohio ($100,000).

In Palm Beach County,  the median income among households who moved other states was higher than the median income for that county ($70,003) in 53% of the states, with the median income at over $100,000 among the biggest group of movers such as New York ($128,300), Illinois ($160,000), and Colorado ($147,000).

In Martin County, the median income among households who moved other states was higher than the median income for that county ($70,003) in 63% of the states, with the median income at over $100,000 among the largest set of movers such as Tennessee ($116,800) and Wisconsin ($237,600).

The development of a mix of housing that caters to both high-income and lower income families will help sustain migration into South Florida.

4. The median value of the property owned by households who moved from other states was higher in about 40% of the states compared to the median property value of the county

Prices of properties purchase vary by location and characteristics, but households who moved from California, New Jersey, and New  York resided in properties with values typically above the median sales price.

In Miami-Dade, the median value of the property of households owed by those who moved from other states was higher than the median property value in that county in 2021  ($403,000) in 40% of the states, such as in New York ($500,000) and California ($1,100,000).

In Broward, the median value of the property of households owed by those who moved from other states was higher than the median property value in that county in 2021 ($335,000) in 2021 in 45% of the states, such as in Maryland ($500,000), Indiana ($900,000), South Carolina ($500,000), and Texas ($531,000)

In Palm Beach,  the median value of the property of households owed by those who moved from other states was higher than the median property value in that county in 2021 ($365,000) in 52% of the states, such as New York ($450,000), Illinois ($670,000), Michigan ($550,000), California ($550,000), Georgia ($600,00), Virginia ($995,000), Maryland ($1,300,000), Oklahoma ($2,000,000), and Nevada ($550,000).

In Martin County, the median value of the property of households owed by those who moved from other states was higher than the median property value in that county in 2021 ($364,000) in 43% of the states, such as New York ($450,000), Illinois ($670,000), Michigan ($550,000), Wisconsin ($750,000), Connecticut ($450,000), and Nebraska ($750,000) .


[1] The median income of all households is official estimates by the US Census Bureau American Community Survey and the income of households who moved is estimated from the 2021 ACS PUMS data.

[1] Analysis based on Table S0701 American Community Survey tables.

[2] Florida Realtors, https://www.floridarealtors.org/news-media/news-articles/2023/01/whos-moving-here-what-drivers-license-data-says

[3] Analysis based on the 2021 American Community Survey PUMS , 1-year estimates (2021 ACS PUMS).

[4] The median income of all households is official estimates by the US Census Bureau American Community Survey and the income of households who moved is estimated from the 2021 ACS PUMS data.

Originally published at https://www.miamirealtors.com/2023/03/15/miami-dades-out-of-state-homebuyers-earn-nearly-100k-median-household-income/

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