Small Towns Drew Most New Pandemic Residents

This story was originally posted by Stateline, an initiative of the Pew Charitable Trusts.

Bend, Oregon, is in the middle of nowhere—two and a half hours from Eugene over a mountain pass that can be treacherous even in springtime. And that’s what people like about it.

“People were already coming here in hordes, and then it just exploded in the pandemic,” said Lynne McConnell, the city’s housing director. “More would be coming if we had housing to accommodate them.”

In states around the country, people who moved early in the pandemic were attracted to wide-open spaces in relatively obscure towns rather than the big cities that had attracted millennials in the previous decade, according to U.S. Census Bureau statistics and Stateline analysis of postal change-of-address data.

The moves may have brought welcome money to smaller towns, but they also raised housing prices and changed the bucolic way of life that attracted residents in the first place. And in the past year, moving patterns largely have reverted to pre-pandemic trends.

Affluent workers who could do their jobs remotely had an easier time moving to far-off areas, especially places like Bend that aren’t commutable. Before the pandemic, people moved mostly for a new job, but since then moves have become more about comfort and lifestyle factors such as good neighborhoods, home ownership, climate and recreation, said Peter Haslag, an assistant finance professor at Vanderbilt University who studied pandemic moves.

The moves also gave a needed boost to bond ratings for remote municipalities, giving them more ability to borrow money for infrastructure projects that can keep them growing, according to another study Haslag co-authored that was published in February by the Georgia Tech Scheller College of Business.

“It becomes relatively less expensive [for growing cities] to take on new projects,” Haslag said. “The evidence suggests that areas that experienced significant inflow during the pandemic should experience relatively greater economic growth.”

Major cities including Chicago, Los Angeles, New York, Philadelphia and San Francisco lost population between 2020 and 2021, according to census estimates, mostly from people moving out.

Where did they go? The postal data suggests they went to some lesser-known places that were more comfortable for remote work, with less crowded conditions.

In Alabama, new residents tripled to 1,543 in Daphne, a city of about 27,000 across the bay from Mobile, from March 2020 to February 2021. There were similar sudden influxes in Martinsburg, West Virginia; Kalispell, Montana; Elkhorn, Nebraska; and Lee’s Summit, Missouri, among others.

In Oregon, it was Bend, where net in-moves more than tripled to 1,214 in the first year of the pandemic. Since then, moves have stalled as housing prices have gone through the roof, and the area lost 1,209 net movers in the past year. The city is struggling with tax and labor shortage issues to get new homes built, McConnell said.

“The problem is the people who swing the hammers can’t afford to live here at the wages construction companies can pay,” she said.

Tax increases also are capped by state law, forcing the city to raise fees as expenses rise, another factor that makes it more costly to build on the city’s rocky, volcanic soil. Homes for sale range from $500,000 to millions of dollars.

“That might look affordable to people from the bigger cities in California and Washington. It’s not affordable to people who live here,” McConnell said.

The influx has been good for city finances, though, said Sharon Wojda, the city’s chief financial officer.

New development has helped tax revenue grow, and the city’s Standard & Poor’s bond report noted an “affluent and rapidly growing economy” attracting young professionals.

Newcomers have caused tension with longtime residents, who face impossible homebuying costs and more crowding on scenic mountain and desert trails. A few “Don’t Move Here” bumper stickers have appeared to compete with the standard “Be Nice! You’re in Bend” sentiment on stickers, McConnell said.

Ellen Waterston, who runs workshops and retreats for writers, sold a house in Bend before the pandemic in fall 2019, thinking she’d rent for a few months and look for a smaller place to downsize. No dice in Bend’s pandemic housing market.

“I wound up bidding on countless houses, entering into new construction contracts only for the builder to back out as the price of materials made it impossible,” said Waterston. “I finally got into a house in Bend only because I happened on a for-sale-by-owner [sign].”

In Sun Belt states, peripheral cities showed the most gains, too: Within fast-growing Maricopa County, Arizona, it was Buckeye in the far western suburbs that got the most pandemic moves, rather than more urban Phoenix, the fastest-growing city in the country in the decade of the 2010s.

Phoenix officials maintain the city is still growing fast. They say the moving statistics may be distorted by college students who didn’t always fill out change-of-address forms when they moved in, and by the fact that ZIP codes don’t accurately describe city boundaries.

“I am comfortable saying Phoenix is going to show significant growth,” said Eric Jay Toll, communications manager for the city’s Community and Economic Development Department.

New York City officials also see better times ahead.

“We have strong evidence that New York City is gaining population,” said Department of City Planning spokesperson Rebecca Weintraub. “U.S. Postal filings suggest migration reverted to pre-pandemic patterns and that many wealthy neighborhoods are seeing an inflow of population.”

Moves out of Manhattan spiked from about 36,000 in the year leading up to March 2020 to more than 100,000 in the following year, but fell back to less than 23,000 the next year, according to the Stateline analysis. In that first pandemic year, remote East Hampton, more than 100 miles away from Manhattan, gained the most movers at 622. But the next year, from March 2021 to February 2022, it was Long Island City in Queens, gaining 960 new residents.

Moves out of New York affected the whole region, including nearby Connecticut, where suburban Fairfield gained the most movers in the pandemic’s first year, 715, a more than three-fold increase.

Terri Ann Lowenthal, a Connecticut-based census consultant, said she saw the effect in nearby Stamford, where in-moves also tripled in the first pandemic year near a commuter rail station. Both Fairfield and Stamford have relatively easy commuter train access to New York City.

“The neighborhood near the train station was overrun by New Yorkers escaping the city,” Lowenthal said. “A local developer was building luxury rental buildings faster than you can spell ‘Connecticut.’”

In Bend, Waterston said people now need a reservation for the famous South Sister volcano hike, the eastern desert known as Oregon’s Outback is getting busier with visitors, and waterways are filled with “thongs and Speedos and inflatable unicorns floating through town.” Signs of its past as a lumber mill and livestock auction town are disappearing, she said.

“Bend is hard for me to recognize,” Waterston said. “I am reacting the same way as many who are packing up and heading for a smaller town only to initiate the same problem.”