Is California Taking Over Portland? 2020 Update
Anyone who spends much time talking to newcomers in Portland (and as real estate agents, we do a lot of that), will notice one thing over and over: There are a lot of Californians coming here!
Note the following recent trends:
- Nearly 40,000 Californians move to Oregon every year (source: Oregon Employment Department)
- Every year, 20,000 Oregonians also move to California (Oregon Employment Department)
- 30-40% of Oregon’s incoming population over the past few years has been made up of Californians (Oregon Office of Economic Analysis)
Should we pay attention to this? Yes, real estate market trends and population dynamics are closely linked. But the story is more complicated than how many Californians are coming here. In other words, Portland’s population is changing in many ways, and it’s not all about California!
Three Portland Population Trends to Watch in 2020
1. Growth Happening Across Oregon
It may seem that outbound Californians are targeting Portland, but it’s simply not true. Given that Portland is the largest population area in the entire state, says the Oregon Office of Economic Analysis, it makes sense that a high percentage of migrants would move here. In a rainstorm, a bucket collects more water than a wine glass. Portland isn’t getting a disproportionate amount of migrants from California. In fact, a large number of Californians who move north end up in Southern and Central Oregon, and they move to those areas at approximately the same rate as they move to Portland. Put another way, it’s raining Californians across the state of Oregon.
2. Oregon’s Economy Depending More on In-Migration
Some may not like to hear this, but Californians do, in fact, “make it rain” for Oregon. We need more people in the state if our economy is going to continue to grow. Portland State University’s Population Research Center found that in 2019, the number of people born in the state was barely higher than the number of people who died. That means the population would not be growing if people didn’t move here! New residents increase the labor pool for businesses (and in a state with very low unemployment, that’s a good thing), drive consumption of goods and services, and increase our tax base.
3. Aging is Happening Faster
No, Oregon is not entering a time warp in 2020 where everyone turns 70 overnight. We’re talking about the fact that the state has a “Silver Tsunami” coming: A wave of current residents who are about to retire. On the other hand, “migration is for the young”, says Oregon State Economist Josh Lehner. The vast majority of people moving into the state — including from California — are under 45. To keep a young population, who can provide care and services to our seniors (and baby boomers in a few years), we need in-migration.
Migration and the Portland Real Estate Market
Portland is not growing nearly as fast as before and overall is average or even a little below average in growth in the U.S. right now for comparable city sizes. So while migration continues, overall population growth has slowed significantly to reasonable levels. However, Portland did experience explosive population growth for many years prior to 2020 and it had a dramatic impact on the Portland real estate market, making housing unaffordable for many. That is changing now as Portland wages are up and the real estate market has cooled down (at least from the craziness that came before). See our 2020 Portland real estate market forecast here that includes pricing estimates broken down into applicable pricing segments. Portland real estate has become much more affordable in recent years.March 6, 2020