Californians are Transferring to Florida Because of Reasonably priced Housing and Fewer Constructing Laws, Based on an Economist | L. Cane
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It’s no secret that recent movers have preferred moving to Florida. Recent data from the Florida Department of Motor Vehicles shows that people from New York, New Jersey and California are among the states with the most people applying for a Florida driver’s license. In fact, according to the New York Post, the data showed that around 30,000 Californians applied for a Florida license in 2022.
Economist Vance Ginn thinks he knows one of the main reasons Californians come to Florida, and he thinks it’s driven in part by saving money, as follows.
Cheaper housing through fewer barriers to real estate development: Ginn, chief economist at the Pelican Institute for Public Policy, recently co-authored an opinion piece in the Washington Examiner. In it he set out his argument that the primary motivation for relocating Californians to Florida and Texas was housing affordability, writing in part:
“Housing affordability has been a major factor that has propelled Californians to states like Texas and Florida where they can realistically afford the American dream of home ownership.”
Ginn goes on to explain that Florida and Texas have cheaper housing because they implement fewer “bureaucratic bottlenecks” for real estate development, writing:
Florida did a good job winning the war on over-regulation to make room for more housing… It’s not complicated: The states and cities that will prosper in the coming decade will be the ones that have a less-regulated housing market allow, i.e. the amount of apartments on offer can efficiently cover the amount demanded.”
US News & World Report concluded that California is the most regulated state in America. And although Ginn’s article is written as an opinion piece, there is some evidence to support some of her claims, as follows.
California has 4 of the 10 most expensive cities in the United States: According to a 2022 study by Rocket Mortgage, the markets of San Francisco, Los Angeles, San Jose and San Diego were among the 10 most expensive cities in the United States and accounted for nearly half of the nation’s most expensive places to live.
In general, living in California is much more expensive than living in Florida: Although Florida’s real estate markets have risen dramatically, they still compare favorably to California.
According to Zillow, the median home value in Florida is $404,939. In California, the same figure is $760,644. So while some Floridians and those looking to buy a home in Florida lament the rising real estate markets, someone coming from California might see Florida real estate prices as a bargain.
Differences in State Income Tax: Although Ginn’s writings did not address differences in state income taxes, there are key differences between these two states that affect the cost of living.
California state income tax ranges from 1% to 12.3% and sales tax ranges from 7.25% to 10.75%. Florida has no state income tax and the sales tax rate is 6%.
