Eye On Housing
Geographic mobility, the movement of people within the United States, declined steadily over the past three decades. Between 1984 and 1985, 20.2% or one out of every five Americans over the age of 1 year moved. In the most recent period, between 2012 and 2013, the mover rate was only 11.7%. The mover rate is a measure of geographic mobility provided by the Census Bureau, calculated by taking the number of movers divided by the total population over 1 year old.
The decline in geographic mobility is due to a combination of factors. In a recent paper from the Federal Reserve discussion series, researchers find declining labor market transitions, rising homeownership rates, and an aging population to be contributing factors.
To better understand the effect of an aging population on geographic mobility, it is useful to examine the distribution of movers by age. According to the Census Bureau, 23.2% of those 25 to 29 years moved between 2012 and 2013. After 30, the share declines with age and for those 65 years and older only 3.7% moved between 2012 and 2013.
The number of seniors is steadily increasing. By 2030, the Department of Health and Human Services forecasts that there will be 72.1 million seniors representing 19.3% of the total population. The long-run implication is that measures of geographically mobility are unlikely to return to levels seen in the mid-eighties.
Instead of focusing on measures of geographic mobility for the entire population, it is often useful to pay close attention to the mobility of a specific age group. Individuals between the ages of 25 to 29 years are of interest to housing sector because these individuals represent future first-time homebuyers. Individuals in this age group are typically transitioning into the labor, marriage, and housing market. The Census estimates the median age at first marriage in 2013 for men was 29 years and 26.6 years for woman. In addition, using data from the Census Bureau’s American Housing Survey, NAHB estimates the average of the first-time homebuyer to be 33.
Between 2012 and 2013 the mover rate for those 25 to 29 years was 23.2%. According to the Census, the most common discernible reason for moving between 2012 and 2013 for those between 25 and 29 was to establish own household at roughly 14.2%. The next distinguishable category of movers at 13.9% did so to new or better housing.
For the second straight period, the share of movers doing so to own rather than rent a home increased. Between 2012 and 2013, 5.2% of all movers in this age group did so to own rather than rent whereas between 2011 and 2010 4.4% did so to own rather than rent.
Overall, measures of geographic mobility for the entire population declined from the prior period. The aging population makes it unlikely that measures will recover to prior levels. Instead, focusing on the most mobile age group, those between 25 and 29 years, it appears as though reasons for moving are promising in that the most common discernible reason was to establish own household.
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