BUT MOVERS FACE TRADEOFFS LIKE LOWER SCHOOL QUALITY, LOWER INCOMES, AND HIGHER CLIMATE RISK
Berkeley, CA (July 30, 2026) —The Bay Area has the highest cost of living of any metropolitan area in the country. Faced with these high costs, many residents are choosing to move to more affordable areas in and out of California, according to a new report from the nonpartisan California Policy Lab (CPL). The new research shows that residents who leave the region often relocate to communities with significantly lower housing costs and are much more likely to own a home — but frequently trade those gains for neighborhoods with lower-performing schools, greater climate vulnerability, and lower average incomes.
The researchers used anonymized credit bureau data to follow Bay Area households over time, examining who leaves, where they go, and how their finances and neighborhoods change after they move. Bay Area residents who left California were 33% more likely to own a home after five years. For those who left San Francisco for another state between 2015 and 2019, the median home value in their new neighborhood was $916,000 lower than the median home value (nearly $1.6 million) in their old community.
People who have left the region since 2014 came from neighborhoods that were typical for the Bay Area, with average incomes, home prices, and demographics. However, movers themselves tended to be financially weaker than their old neighbors, as reflected in credit scores that were 23 points lower, on average, and they owed nearly twice as much student debt as their old neighbors ($10,827 vs. $4,618).
“The Bay Area continues to offer tremendous economic opportunity, but it’s also the most expensive metro in the country,” said co-author Evan White, Executive Director of the California Policy Lab at UC Berkeley. “Our research shows many residents are achieving affordable homeownership elsewhere, but often at the cost of lower incomes, lower-performing schools, or greater climate risk.”
Key Findings
- Residents who leave the Bay Area are more likely to become homeowners.
- One year after moving, Bay Area residents increase their homeownership rates by 11–18%. After five years, homeownership rates rise by 33% among those leaving California.
- People who move see lower housing costs, but there are tradeoffs.
- People leaving the Bay, whether within California or out of state, move to neighborhoods where home values average about 50% lower and rents are 33% lower, but their new neighborhoods also tend to have lower-performing schools, lower average incomes, and greater climate vulnerability.
- People who leave the Bay Area tend to have lower credit scores and more student debt than their neighbors.
- Movers leave neighborhoods with similar average incomes, home values, and demographics as the Bay Area overall. But compared with their neighbors, they have credit scores averaging 23 points lower and carry more than twice as much student debt ($10,827 vs. $4,618).
- Migration is making the Bay Area more racially diverse.
- Net migration patterns show White residents leaving the region, while residents of color — particularly Asian and Pacific Islander households — are arriving in higher numbers or leaving in lower numbers.
- San Francisco’s pandemic population losses are reversing.
- After sustained out-migration during the pandemic, San Francisco has experienced net in-migration since mid-2024.
“One of the broader questions our report raises is who gets to live in the Bay Area?” explains Dr. Brett Fischer, a Researcher at the California Policy Lab’s UC Berkeley site. “Our research strongly suggests that high housing prices are pushing people out, a trend that some fear may be exacerbated by the AI boom putting more pressure on housing prices.”
The report, Priced Out of the Bay, builds on CPL’s earlier statewide report, Priced Out: Who Is Leaving California, Where They Go, and Whether It Pays Off, by examining how the Bay Area’s high cost of living is influencing where residents move and the tradeoffs they face after relocating.