
Business Insider
Wall Street Journal
more residents to outward migration than any other city in the country.”
New York Times
– and it could mean disaster for the nation’s tech capital.”
SFGate
Net Domestic & Foreign, and Total Net Migration Numbers, per U.S. Census
The last column in each year tallies the net positive migration number
5-County San Francisco Metro Area Migration
The last column in each year tallies the net positive migration number
Summary Chart of Annual Migration & Population Growth
in 5-County SF Metro Area
The Bay Area population is still growing both from migration and natural factors (births less deaths), albeit at slower rates than the torrid pace of previous years. As the WSJ admits in its article, SF and SF metro area populations are not shrinking: The SF Metro area population increased by .6% in the last 12 month period, as measured by the census through 7/1/17, which is one tenth of 1 percent lower than the .7% national average. A slower rate of growth than our recent population explosion is actually a good thing, since the Bay Area is bursting at the seams from growth without concomitant improvements in housing supply and infrastructure.

Short-Term Population Changes: 5-County SF Metro Area
The representation by Business Insider that 49% of residents were looking to move out is simply absurd. Really? Every other person? If people were fleeing or planning to flee in the proportions suggested, one would expect every other home in the Bay Area to sport a “for sale” sign, while the percentage of homeowners selling their homes is actually at historic lows: Less than 2% of SF house owners sold their homes in 2017. (The ratio was higher for condo owners, but still low at something over 4%.) I suppose it is possible that in the frenzy to get away, people are simply abandoning their homes instead of selling them.

Bay Area employment growth remains extremely strong. According to the CA Employment Development Department, for the six big Bay Area counties (the 5-county SF metro area plus Santa Clara County), no matter which month of 2017 one looks at, the year-over-year increase in Bay Area employed residents ranged from 60,000 to 90,000. As the WSJnotes: “The broader Bay Area is the most robust metro region in the nation in terms of payroll job growth, according to the most recent regional analysis from the University of California-Los Angeles Anderson Forecast, an economic forecaster.”
5-County SF Metro Area + Santa Clara County

Some other factors to consider:
Many of the people leaving inner Bay Area counties are moving to adjacent counties, such as Solano, Sonoma, Sacramento, Santa Cruz, San Joaquin, San Benito and Stanislaus Counties. Many of those people almost certainly continue to work within the metro area. To some degree, the Bay Area economic zone is expanding geographically, not declining.
The Bay Area over the past 7 years has been one of the greatest new-wealth creation machines in history. With the recent Dropbox IPO, it seems to be cranking into gear again – and there are still dozens of other local unicorns such as Uber, Pinterest, Airbnb, Palantir, with total values in the hundreds of billions of dollars – that could yet go public. Uber has already stated its desire to do so in the near future.
A significant portion of those leaving the Bay area are retirees, cashing out on high home prices to move to less expensive locales, such as other counties in California, and Nevada, Arizona and Oregon. This is not a new phenomenon, as it has been going on for decades, though it may have accelerated in recent years, since cashing out has become so much more lucrative.
Most of those coming to the Bay Area are coming for new jobs, and the Bay Area remains a magnet for many of the best and the brightest around the world. Besides which, every year, thousands of Bay Area students graduate from schools like UC Berkeley, UCSF and Stanford, to take jobs locally as well. Economically, the Bay Area is trading many residents who are, to a large degree, checking out of employment for people in the prime of their working lives. A new 2018 study by BuildZoom (whose accuracy we cannot evaluate) found that the median income of people moving into the Bay Area was substantially higher than that of people moving out: According to the study, from 2010 to 2016, newcomers out-earned relocating residents by about $18,700.
Millions of square feet of new commercial office space continue to be snapped up as soon as they come on market, even before the buildings are finished, and the only possible reasons are new businesses arriving and existing high-tech, bio-tech and fin-tech businesses – such as Google, Facebook, Amazon, Dropbox – continuing to expand, both of which are fueled by continued hiring.
Last, but not least, neither Bay Area home prices nor rents have, so far, been dropping – most median home sales prices jumped in 2017 and early 2018, and rents stayed relatively unchanged – which one would expect to see if the doom-laden media articles were correct in their analyses.


The Bay Area certainly has substantial economic, social and demographic challenges to face and it is not sure it will overcome its problems. And it is true that people and businesses are moving out in greater numbers than any time since 2002. But, on the other hand, start-ups continue to start up by the hundreds, local business continue to expand, and the Bay Area undoubtedly remains one of the most innovative and dynamic economies in the world. And despite all its faults and problems, it is still, in my opinion – and the opinion of most of the people I’ve met around the Bay Area, the country and the world – one of the great metropolitan areas on the planet.
Other Paragon reports you might find interesting:
Positive & Negative Factors in Bay Area Markets
Changing California Migration Trends
30+ Years of Bay Area Real Estate Cycles