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For about 60 years, California’s population grew steadily, but in the 2010s that growth began to taper. 

A new report points toward housing costs as the prime culprit: Even California’s least-expensive communities cost more than most places in the country. That gives some households a reason to move somewhere cheaper – and others a reason not to move to California at all.

In Priced Out: Relocation Amidst California’s Affordability Crisis, Brett Fischer and Evan White of the California Policy Lab use credit records to track who leaves California, where they go, how their finances change afterward, and who is moving in. On average, people who left landed in much cheaper neighborhoods, mostly in nearby states, and saw their homeownership rate rise in the following years. 

Key Takeaways:

Cheaper Neighborhoods for Leavers: Californians who leave the state move to neighborhoods where average monthly housing costs are $672 lower. Seven years later, leavers were 48 percent more likely to own a home than similar people who stayed in California.

Higher-Income, Financially Stretched: The share of leavers from the highest-income 30 percent of neighborhoods rose 6.4 points since 2016–2019. Yet leavers’ credit scores average 17 points below those of people in their old neighborhoods who stayed.

Fewer Arrivals to California: Relative to population, 42 states have sent fewer people to California since 2020 than in 2016–2019. 

Using anonymized credit records for a nationally representative 1 percent sample of Americans, the authors follow where people moved between 2016 and 2025. Because it covers only people with credit records (about 90 percent of adults), it misses some residents and can’t see moves abroad. They compare people before and after a move and compare movers with people who hadn’t yet moved, adjusting for year-to-year trends and for factors like age. The seven-year homeownership result covers people who moved in 2016–2019. 

These comparisons describe how leavers’ circumstances changed, how they differ from neighbors, and where they go.

Leavers Land in Cheaper, Lower-Income Neighborhoods: Californians who leave the state move to neighborhoods where average monthly housing costs are $672 lower. The median home value is almost $396,000 lower. In the new neighborhoods these Californians moved to, 60 percent own their homes, versus 53 percent in the neighborhoods they left. Per-person incomes in the new neighborhoods run about $339 less per month, but the authors say the lower housing costs far outweigh that.

Leaving From Higher-Income Areas, With Weaker Finances: The share of leavers from the highest-income 30 percent of neighborhoods rose 6.4 percentage points from 2016 to 2019. Yet they owe $5,500 more in student debt than neighbors who didn’t move. They also have credit scores that average 17 points below those of neighbors who stay. The pattern is consistent with leavers wanting a quality of life they couldn’t afford at home.

Fewer Arrivals, Nearby States Gain Most: From 2020 to 2025, 42 states sent fewer people to California per resident than they did in 2016-2019. In 34 of those states, the drop in people coming to California was larger than any increase in Californians moving there, so fewer arrivals, plus extra departures, widened California’s net loss. Where Californians do go depends heavily on distance. Net migration from California generally falls the farther a state is from California, which helps explain why Nevada ranks first and Texas only 11th among states receiving Californians relative to its population.

The authors argue that declining arrivals deserve greater attention and that policymakers should restore California’s appeal to residents and newcomers. Because high costs appear to shape where leavers go, lowering them could plausibly help keep neighbors and draw newcomers, though the report doesn’t test that directly.

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