A quarter of all baby boomers plan to move to a new city to be closer to their grandchildren, according to research from Livabl.com, the country’s premiere site for new home listings.
“The Livabl Baby Chaser Index was created to capture this interconnectivity between millennials and baby boomers,” said Ali Wolf, Livabl’s chief economist. “The index tracks where there’s the most overlap in migration between baby boomers and millennials across the country. The ‘baby chaser’ name relates to the boomers’ desire to be close to their grandchildren.”
The “baby chaser” effect is set off by a chain reaction: Millennials, in their prime working years, prioritize job availability in their relocation decisions. Boomers are often the parents of millennials, and when grandchildren are involved, the latter group wants to remain near their families.
The Livabl index shows 25 percent of baby boomers intend to retire in a location close to their grandchildren.
The Baby Chaser Index for 2022 shows:
- Austin landed as the top market for the second year in a row. Despite some uncertainty in the tech sector, the Texas capital continues to attract younger folks. The rate of growth in Austin among millennials is 27 percent above 2019 levels.
- North Carolina showed well, with Raleigh placing second and Charlotte sitting at No. 4.
- Orlando, Florida, No. 3 on our list, benefited from a year-over-year migration boost from both millennials and boomers.
- Dallas landed in the fifth position – the other Texas metro to make the Top 10 was San Antonio, landing in the eighth spot.
- Nashville, Tennessee, moved up two spots from 2021 year-over-year to No. 6. The city wasn’t in the top 10 in 2020.
- Phoenix moved down the list from No. 5 to No. 10, driven by slower boomer migration.
- Every baby chaser market in 2022 was in either the Southeast or Southwest.
When looking at the top locations for the most high-income job growth since early 2020, Austin leads the way with 29 percent high-income job growth, followed by Dallas and Raleigh, both at 18 percent.
Traditionally more attractive cities such as New York (two percent growth), Los Angeles (two percent), San Francisco (three percent), and Chicago (two percent) have less growth than some of their southern counterparts.
Beyond employment growth, widespread work-from-home options have enabled more migration than was previously feasible.
Austin: Employment Growth Has Contributed to Population Growth
Austin was the top baby chaser market again in 2022. Over the past five years, Austin has placed first three times (2019, 2021, and 2022).
The strong migration is tightly related to Austin’s strong job market that was ranked first in total job growth and high-income job growth in our large metro area analysis. The local economy is fueled by technology companies (Samsung, Apple, IBM, Dell, and Amazon), health care (Ascension Seton and St. David’s HealthCare Partnership), education (University of Texas at Austin), and the state of Texas.
Another attraction is affordability for many out-of-state buyers. Boomers following their children from more expensive markets see Austin as a relatively affordable area.
Austin has numerous recreational amenities, including the Hill Country, lakes, outdoor activities, a variety of cultural happenings, and a great food scene. People have been drawn to the market for jobs and relative affordability, but they stay for the lifestyle.
Raleigh: Universities Help Attract and Retain Buyers
Raleigh has similar advantages to Austin. The strong supply of universities in the region often serves as the starting point for many out-of-towners. After college, many graduates stay in the area due to the strong job market with strengths in education, health care, and technology.
In Raleigh, Apple announced a new facility is in the works, but a more immediate driver has been Fujifilm’s new manufacturing plant in nearby Holly Springs. Other big job announcements include railroad car manufacturer TTX moving its headquarters to Raleigh, VinFast opening an electric vehicle manufacturing facility in Chatham County, and ProPharma moving its headquarters to downtown Raleigh.
Many Northeastern buyers can make all-cash purchases in Raleigh despite the nearly 60 percent existing-home price growth since the start of the pandemic. Out-of-town buyers generally bring equity and are less sensitive to home prices and interest rates than local buyers.
Raleigh also offers a nice quality of life with a temperate climate and plenty of things to do. It’s a reasonable drive from staycation getaways, including the mountains and the beach, and has broader accessibility with its midsized airport.
Orlando: Market Offers Nostalgia and No State Income Tax
Orlando’s location is appealing across both demographic cohorts with recreational activities locally as well as a reasonable drive both east and west to the coasts.
Further, Orlando’s housing is generally more affordable than other top markets in the state. Orlando is one of the only metros in Florida that isn’t landlocked, allowing for development across all four cardinal directions. The requirement of flood insurance in Orlando is rare, which stands in direct contrast to some other Florida metros. Both factors are important in maintaining housing affordability.
There are also specific qualities that appeal to different demographics. For baby boomers, Orlando is often a consideration for those thinking they want to “retire in Florida.” Disney and Universal theme parks provide nostalgia and familiarity. For those looking for a 55-plus new-home community, Orlando has the second largest age-restricted supply in the state, according to Zonda data.
Boomers interested in such communities often start their search within the well-known The Villages development, but sometimes expand their search radius into Orlando depending on their needs.
While Orlando is commonly thought of as a leisure and hospitality hot spot, the increase in high-income jobs locally, especially in tech. The metro saw a 42.7 percent increase in tech job postings from January to October 2022, and the only U.S. market to outpace Orlando’s growth was Houston.
Millennials considering employment in their relocation decision have more jobs to choose from in Orlando while also benefiting from the lack of state income taxes.
Charlotte: A grown-up city with lots of recreational opportunities
Charlotte’s appeal is driven by lifestyle and affordability. The city has a diverse job market mostly based in the financial sector. All the major banks have large offices in Charlotte, or some presence in the city.
There are many Fortune 500 companies, such as Bank of America, Lowe’s, Nucor, and Honeywell. There are also plenty of start-up opportunities for Charlotte residents to have their own small businesses of any type. Whereas Raleigh is concentrated on technology and bioscience, Charlotte’s focus is more concentrated on careers in finance and business services.
Charlotte is centrally located for recreation purposes. Residents are a couple of hours from the mountains, and a similar distance to the beaches. Potential buyers can also enjoy the Appalachians and Smoky Mountains, as well as Asheville to the Northwest.
Meanwhile, there’s Charleston and Myrtle Beach about three hours to the southeast. Residents of Charlotte experience the best of all worlds, as well as the benefits of being located in Charlotte itself. There are several large-scale parks walking trails, fishing, boating, mountain biking, and white-water rafting.
The city has an established downtown with restaurants, high-rises, museums, and sports facilities. This “grown-up” feel is what attracts millennials in their late 20’s and 30’s to the areas.
Dallas: Centrally located with cost-of-living appeal
Dallas has experienced tremendous migration from around the country. That migration includes not only households, but also businesses, with large Fortune 500 companies choosing to make Dallas their headquarters. Names such as ExxonMobil, McKesson, AT&T, American Airlines, and more are scattered throughout the Dallas-Fort Worth metroplex.
When compared to locales such as California or Washington, Dallas offers significant cost-of-living benefits, which has attracted many — from working-age people to families — away from the coastal areas. Those arriving with a lot of equity in their homes from more expensive cities find the Dallas housing market to be a bargain by comparison.
Final Considerations
Work-from-home options and lifestyle choices, particularly of boomers and millennials, are driving shifts in local economies and the housing market.
Earlier this year, Builder Online, Livabl’s sister site, published a look at baby boomers and how they are still pushing the housing market forward despite higher home prices and interest rates. Boomers overtook millennials for the first time since 2014 as the top buyers in 2022.
This is partially because boomers and millennials are often competing for the same product, but Boomers can pay more and are less sensitive to mortgage rates and home prices given built-up home equity and general wealth accumulation.
Therein lies the challenge in being a top baby chaser market. While migration is good for agglomeration and longer-term growth, the increased population is not without obstacles. Rising home prices, congestion, and inflation are short-term imbalances in top growth markets that have hindered economic and housing potential in some areas (Austin being the poster child).
In the medium and longer term, though, we believe in the sustained desirability of many of these markets given their strong performance in job growth and other solid fundamentals, such as pleasant climates and accessibility to infrastructure.
Methodology
The index was created to identify where there is the most overlap between migration patterns for those at or near retirement age and older millennials. The index looks at both short-term and long-term population and migration trends for those 25-34 and 55-plus.
Media Contact: Valerie Sheets
Contact Phone: 949-294-9557
