Was the “Urban Exodus” Real? Car Shipping CEO Weighs In

The story of an “urban exodus” circulated widely after the start of the COVID-19 pandemic in 2020. That narrative suggested that people moved a lot from large urban centers like New York City, San Francisco, and Los Angeles to smaller cities and more rural areas post-pandemic. But how substantial and long-lasting that trend was is a more complex story.

For an insider’s perspective, Automoblog spoke to a number of professionals who could offer a more personal insight based on their first-hand experience, including Tsvetelin Savov, CEO of SGT Auto Transport, one of the country’s most popular auto transport companies. During our interview, Savov shared his observations of where people have been moving since the start of the pandemic and discussed how the auto transport industry as a whole has changed in the wake of COVID-19.

“In the initial months, there was a significant increase in the number of vehicle shipments to smaller rural areas as people began to move from larger metropolitan areas to more isolated locations,” he recounted.

People moved from the bigger cities to the smaller ones

Over the past three years, the narrative that people left big cities for smaller neighborhoods during and after COVID-19 has been widely circulated in mainstream US media. While there are nuances to that narrative, the fundamental conclusion has some validation.

The Federal Reserve Bank of Cleveland conducted a periodic study on the subject, collecting and synthesizing data from the Federal Reserve Bank of New York Consumer Credit Panel/Equifax Data, the American Community Survey, the National Association of Real Estate Agents and other entities. The first quarter 2021 edition of the study compared the “migrations” of the first year of the pandemic with those of the previous three years.

The study defines four categories of premises:

  • Large, high-cost metropolitan areas with populations of more than 2 million (hereinafter referred to as “large expensive metropolitan areas”)
  • Large low-cost metropolitan areas with populations of more than 2 million (hereinafter referred to as “large less expensive metropolitan areas”)
  • Midsize metropolitan areas with populations between 500,000 and 2 million (hereinafter referred to as “midsize metros”)
  • Small metropolitan areas with populations of less than 500,000, including rural areas and towns (hereinafter “smaller cities, towns and rural areas”)

Between the second quarter of 2020 and the first quarter of 2021, smaller cities, towns, and rural areas experienced an increase in moves in all other categories compared to the previous three years. These areas also saw the largest increase in moves, at 13.6%, from large, expensive cities of any category.

Medium-sized cities saw a decrease in moves from smaller cities, towns, and rural areas in the first year of the pandemic. However, they saw an increase in all other categories, including a 13.4% increase in moves from large, expensive cities.

Professionals say the data aligns with their experience

The data paints a relatively clear picture of these trends in motion. However, that picture can often be incomplete when based on data alone.

Savov’s work has given him unique and direct insight into movement patterns in the US. When we spoke to him, he told us that his personal experience and his company’s data pretty much aligns with what we found in our research.

“We saw an increase in shipments to older towns and cities, as well as more remote locations across the country,” he said. “This was probably due to a desire for more space and distance from others during the early stages of the pandemic.”

The trend is something real estate agent Yannick Lloyd can attest to. Lloyd’s is headquartered in the “Triangle” region of North Carolina, an area that includes Chapel Hill, Durham, Raleigh, and several smaller cities and suburbs in between. The Triangle was one of several less expensive large subways that saw significant growth in the early stages of the pandemic.

As a real estate agent, Lloyd works closely with people moving to the area. This gives you a more intimate idea of ​​why people made the decision to move to the Triangle. He said that for most people, cost was one of the main driving factors.

“Relocation [to the Triangle] from larger cities has definitely increased in recent years,” Lloyd told Automoblog. “Economic changes made people rethink the value of larger cities. Affordability continues to be a big selling point for the Triangle. Although prices have risen in the area, homes in the Triangle are much more affordable than larger cities in the Tri-State Area and the West Coast.”

Removals also provide information

There was a 9.4% increase in moves to less expensive large cities from large, expensive cities during the period. However, removals from all other categories decreased.

But the story is not just about where people from the larger cities moved to during the period, but also where they did not move to these cities. There was a slight positive change in moves from large, high-cost metro areas with populations over 2 million to other metros in that category.

However, there was a significant drop in moves to large, expensive cities across all other categories. This includes a 6.1% decrease in the number of people moving to these cities from smaller cities, towns and rural areas.

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Savov said his internal autoship data also supports this part of the narrative. “This trend [of increased shipments to towns and rural areas] continued for much of the year [2020]with many individuals and families looking for less crowded areas to live and work.”

Lloyd noted that many of these moves have been made possible by the ability to work from home. He said this new capability, combined with rising costs, has made moving outside of big cities an attractive option for many people.

“More people have had the freedom to work remotely since the pandemic,” Lloyd said. “The cost of living has become a priority since 2020 due to inflation.”

The narrative of an “urban exodus” is complicated

This data set compiled by the Federal Reserve Bank of Cleveland from the first year of the pandemic provides a compelling argument for the popular narrative of an “urban exodus,” but it doesn’t tell the whole story. Another way journalists and researchers track data in motion is by monitoring USPS change of address forms.

These data add an important facet to the story. While it indicated a slight increase in the filing of permanent change of address forms, it also revealed a much larger increase in the filing of temporary change of address forms.

These trends suggest that many of the movements that occurred in the first year of the pandemic were not permanent movements. So while people were leaving big, expensive cities, many were leaving with the idea of ​​returning.

The trend away from big, expensive cities has slowed rapidly.

Just as many of the moves at the start of the pandemic were temporary, so too was the trend of people moving from large and expensive metropolitan areas. Or, at least, that’s what an updated version of the same data set from the Federal Reserve Bank of Cleveland would suggest.

a line graph shows the rate of emigration from large urban centers to less populated areas from 2010 to 2022

Updated data including the fourth quarter of 2022 shows that while out-migration from urban neighborhoods increased in 2020, the number of people moving out of those areas decreased significantly in 2021 and 2022. This could be due, in part, to that people who were inclined to leave already did so in 2020. However, it also goes against the narrative of an “urban exodus” as a lasting trend or cultural change.

COVID has had a huge impact on the auto shipping industry specifically

The auto transportation industry is one of many that has undergone significant changes since the start of the pandemic. Savov told Automoblog that for SGT, that change has been positive business-wise.

He speculated that the positive impact for his specific business is due to several reasons. One is that cars are needed more in the smaller cities and rural areas that people have moved to since 2020 than in the big cities from which they moved.

“[The pandemic] it has resulted in a greater need for auto shipping services as people have had to move their vehicles long distances to their new locations,” Savov said. “This has been particularly true for families and individuals looking to move to more isolated areas.”

Mandatory restrictions, quarantines and other government policies enacted in response to COVID have also played a role, according to Savov. He said these policies made it more difficult to drive across multiple states, making auto shipping a more attractive option for many.

“With the government’s travel requirements and restrictions, many people were unable or unwilling to drive their vehicles long distances,” Savov said. “As a result, there has been an increase in demand for car transport services as more individuals and families turn to car transport as a safer and more convenient alternative.”

Car transport after COVID: what we have learned

The idea that COVID-19 “changed everything” is now perhaps as cliché as the phrase “new normal” was at the end of 2020. But the changes in movement patterns that followed the start of the pandemic offer a lot of perspective on how we responded to the situation. They also provide information on how we may respond to similar situations in the future.

The same density that created opportunities and drew people to cities also made those places dangerous and difficult to live in when COVID began to spread. Many of those who were able to leave those cities did. And many of those moves were made possible by the ability to get away from offices without leaving work.

Whether people choose to return to big cities in the coming years remains to be seen. Based on our research data and the experience of people like Savov, that shift toward urbanization may already be underway.

“Over the past few months, we have started to see things return to a more normal pattern,” Savov said. “The number of vehicle shipments to larger metropolitan areas has started to rise again as life returns to normal.”

However, if the COVID-19 pandemic and its myriad and substantial effects on people and industry have made one thing clear, it is that things can change dramatically and without warning.

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