More high-income households have left California and New York than moved in, but some states saw the opposite.
Florida had the biggest net gain of high-earning households, according to a recent SmartAsset study. SmartAsset analyzed the latest available IRS data from the 2021-2022 tax year. Using $200,000 of adjusted gross income as a threshold, the study examined the number of high-income households moving into and out of each state to determine the net inflow.
Texas came in second in terms of net inflow, followed by North and South Carolina and Arizona.
What’s driving migration to these states?
Florida, Texas, Tennessee, Nevada and New Hampshire — all in the top 10 — don’t impose income taxes, which could be a big driver for migration to these places, says Jaclyn DeJohn, SmartAsset’s managing editor of economic analysis. But states without those tax breaks still attracted new residents, as did those with smaller populations.
“I would say that’s a little unique, that these smaller-population states are really pulling their weight in attracting or pulling above their weight in attracting high-earning households,” DeJohn says.
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The term “household” doesn’t necessarily mean a huge family, according to DeJohn. It also includes single people. High-earning single people might have the mobility to relocate, says David Tinsley, the senior economist at the Bank of America Institute.
Affordability, especially when it comes to housing, could be a factor, according to economists. Even though high-income households moving into Southern states might drive up prices, housing will still be cheaper there than in other markets, says Charlie Dougherty, a director and senior economist with The Wells Fargo Economics Group.
“If you look at Texas, you look at Florida, the relative affordability advantage there, especially in terms of housing, remains true,” Dougherty says. “Especially compared to the high-priced, coastal Western markets: Bay Area, Los Angeles, Portland, Seattle, etc.”
There’s also the labor market to consider. Despite tech industry layoffs in the Austin area, Texas remains one of the better places to find a job in the United States, along with Florida.
Though many employees have been able to work remote in since the Covid-19 pandemic began, folks do find themselves moving where they can find work, according to Tinsley. People have “been pulled to move by where the demand for labor is,” he says.
Here are the states that saw the biggest net inflow of high-earning households:
1. Florida
Net inflow of high-earning households: 29,771
Average adjusted gross income for high-earning households moving in: $907,013
2. Texas
Net inflow of high-earning households: 8,260
Average adjusted gross income for high-earning households moving in: $579,207
3. North Carolina
Net inflow of high-earning households: 5,792
Average adjusted gross income for high-earning households moving in: $456,384
4. South Carolina
Net inflow of high-earning households: 5,270
Average adjusted gross income for high-earning households moving in: $501,205
5. Arizona
Net inflow of high-earning households: 4,365
Average adjusted gross income for high-earning households moving in: $561,112
6. Tennessee
Net inflow of high-earning households: 4,320
Average adjusted gross income for high-earning households moving in: $586,256
7. Nevada
Net inflow of high-earning households: 2,589
Average adjusted gross income for high-earning households moving in: $845,035
8. Idaho
Net inflow of high-earning households: 2,113
Average adjusted gross income for high-earning households moving in: $494,497
9. Colorado
Net inflow of high-earning households: 1,403
Average adjusted gross income for high-earning households moving in: $590,626
10. New Hampshire
Net inflow of high-earning households: 1,104
Average adjusted gross income for high-earning households moving in: $619,679
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