Americans moved around a lot over the past two years, and those destinations also now happen to have the highest inflation rates in the U.S.
“We saw right away that inflation was highest in Phoenix and lowest in San Francisco,” Redfin deputy chief economist Taylor Marr told CNBC.
The relationship between migration and inflation has strengthened significantly as more people relocate from expensive coastal cities to more affordable metro areas, according to an analysis released by Redfin, the real estate broker.
Phoenix is one of the inflation hot spots that has seen an influx of new residents.
“Almost every component of the Phoenix CPI for whatever reason is up about 10%,” Lee McPheters, research professor of economics at Arizona State University, told CNBC.
Atlanta and Tampa are also among the metro regions seeing both hot inflation and the pandemic-related surge in homebuying.
“People move to Atlanta because it’s more affordable,” Vivian Yue, economics professor at Emory University, told CNBC. “But now once people get here, [they say]: ‘Wow, this inflation is so high compared to where [we] moved from.'”
Prices are up across the country. The consumer price index rose by 8.3% in April 2022 from a year ago.
“For years and years, it’s always been a mixed bag of things going up, other things coming down, and that’s not the case lately. Essentially, everything is rising,” Steve Reed, economist with the U.S. Bureau of Labor Statistics, told CNBC.
Watch the video above to learn more about why migration impacts inflation, how the Bureau of Labor Statistics measures rising costs, the role of wages and what may be next for these hot spots.
