Americans are continuing to relocate from higher-tax states to lower-cost regions, particularly across the South and Sun Belt.

According to a Fox Business report citing recent Census Bureau migration data, states with lighter tax burdens and lower living costs have continued to attract residents, businesses, and investment. In contrast, several higher-tax coastal states have experienced ongoing domestic outmigration.

Census Bureau government finance data show significant differences in state and local tax collections across states, with New York, Connecticut and New Jersey among the highest on a per-resident basis and Tennessee, Mississippi and Alabama among the lowest.

Affordability Drives Migration

The migration trend comes as affordability remains a growing concern for many Americans. A recent Gallup survey found rising prices remained Americans’ top financial concern for the fifth consecutive year, while 55% of respondents said their financial situation was getting worse, the highest reading outside periods surrounding the Great Recession.

Housing costs have also remained under pressure. U.S. Census Bureau data released in May showed new-home sales fell 6.2% in April as elevated mortgage rates weighed on demand, while the median new-home sales price rose to $422,500. Existing-home prices also remained near record levels, underscoring ongoing affordability challenges across many housing markets.

Separate housing-market research from Redfin found buyers are increasingly gravitating toward lower-cost Midwest suburbs and smaller Florida markets. Redfin Senior Economist Asad Khan said affordability is driving much of the shift as buyers search for lower housing costs without giving up access to jobs and amenities.

Taxes And Cost Of Living

Tax concerns may also be contributing to relocation decisions. A January survey by the Pew Research Center found 60% of Americans believe they pay more in federal taxes than is fair, up from 56% in 2023.

Supporters of lower-tax policies argue the approach has helped attract workers, retirees and businesses to Southern states, particularly as remote work gives people greater flexibility over where they live. Critics contend lower-tax states could face growing challenges funding infrastructure and public services as populations expand.

The Census migration data suggests affordability, housing costs and taxation remain important factors influencing where Americans choose to live.

Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.

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