I saw a study a few months ago that predicted that between 2000 and 2020, some 50 million Americans were going to relocate from North to South of the 38 parallel on a line roughly between Raligh/Durham, N.C. and Santa Barbara, California. There will be some exceptions to the rule, but the older cities such as Boston, New York, Phildelphia, Pittsburg, Cleveland, Cincinatti, Chicago, and Detroit will be hit hard. This will be the greatest migration in history; even greater than when the new world was discovered, and it will have profound effects on everyone.
First of all, the States that lose population are going to have fewer and fewer people to support their social programs and infrastructure. Those who remain behind will be older people, retirees, and those too poor to move. This is going to put incredible strains on all sorts of social programs, schools, hospitals, public utilities, etc. The more the losing cities, counties and States raise taxes, the more people and employers who will opt to leave for lower taxed areas.
In 1982 I took a protracted trip over an entire summer visiting areas which at that time were losing manufacturing plants in the “Rust Belt”. At the same time, farms all over the mid-West were being foreclosed. Those who lost jobs, businesses, and properties moved to areas that offered more opportunity. In the past 12 months, I’ve driven throughout New England, New York, and Pennsylvania. In addition to 7000 miles going West to East across the country. The erosion of opportunity that I saw 25 years ago has spread to Montana, New York, North and South Dakota, Minnesota, Illinois, Michigan, and New England.
The bottom line here is that it might be a good idea to take a very hard look at where you now live and invest and ask yourself what it will be like in 20 years. If you don’t see anything that would reverse dropping incomes and population, those are the real keys to creation of real estate profits. It might be time to start planning a move to another area.
The States that are predicted to gain population are going to have growing pains. They’ll need all sorts of new State, County, and municipal services. They’ll need to build schools, hospitals, government office buildings, roads, airports, etc.
