When you imagine where “big tech,” or the leading technology companies of the world would reside Texas probably doesn’t come to mind. For most, Silicone Valley is the most apparent option; this is largely due to the mass amount of technology firms that have established themselves in California over the past 50 years, such as Google, Facebook and Amazon. However, with California’s rising taxes and land expenses, these companies are looking to relocate in aspirations for cheaper alternatives, and Texas is at the top of their I ist.
One of the main issues with having a major corporation in California is the “sky-high,” 13.3% income tax rate in California. In comparison, Texas has no personal income tax and for these large companies, that means more money in their pockets! The resulting tax break from this move has companies such as Google, Facebook, Hewlett Packard Enterprise, and most recently Tesla calling Texas their new home.
Housing Market Breakdown
With homes averaging “$207,300 in Texas while the same house in California is nearly triple the cost ($605,280)”, the opportunity to have more disposable income becomes a driving force for many Californians (Sisson 2020 ). Texas offers affordable housing, cheaper land, and lower taxes which has made this transition a “no brainer.” But don’t be fooled, it isn’t just wealthy individuals or large corporations leaving California for the Lone Star State. “Every year for the past 15 years, about 100,000 more Californians leave the state than other Americans move in, with the most popular destination being Texas” (Devore 2020).
Just in the Austin area alone, more than 36,000 people move each year, which breaks down to roughly 100 people per day! These individuals, now with more disposable income, can purchase homes and even build them from scratch. Which is good for us (RV parks), since many who are building a new home, or moving to a new city, turn to RV parks for temporary housing.
Although, with a higher influx of people relocating to Texas with larger housing budgets based on their income, it’s no secret the real estate market will continue to rise.
For us, that means a higher ROI on property sales, which in turn provides more flexibility for expansion. We’re confident that these new Texans will help our business grow and prosper, bringing new projects and possibilities to TBG.
Check out these sources to learn more:
https://www.cbre.us/research-and-reports/US-Real-Estate-Market-0utlook-2021
https://www.cnbc.com/2020/12/0l/hpe-is-relocating-headquarters-to-houston-from-california.html https://www.foxbusiness.com/business-leaders/tesla-elon-musk-california-texas
https://arc hive.curbed.com/2020/1/14/21059177/texas-california-real-estate-housing-moving