Introduction

Residential real estate is fundamentally shaped by communities’ evolving preferences and circumstances. The US Census Bureau’s American Community Survey (ACS) provides invaluable insights into migration flows, home values, and household composition, serving as a key component of our analytics at F5P. By leveraging this data, we can pinpoint the demographic shifts that forecast tomorrow’s housing demand.

In this post, we’ll explore three key trends emerging from ACS data that every developer and investor must understand to stay ahead of the curve.

1. Inter-regional migration is cooling post-pandemic, but Southern states still see highest inflows

The pandemic spurred a wave of lifestyle and cost-of-living migration that had clear winners and losers. Since 2020, an average of 7.9 million people moved across state lines each year, compared to 7.4 million between 2016 and 2019. The region with the most net in-migration is the South, with Texas and Florida welcoming the most new residents.

However, the age of pandemic-era gains may be coming to an end. As the chart below illustrates, migration in 2023 dipped below 7.6 million, and rents and home values across the Sunbelt are cooling.

At a regional level, while overall migration is down, the South remains the most popular destination. The visual below illustrates shares of regional moves from and to the Midwest, Northeast, South, and West. In 2023, moves to the South accounted for 49% of inter-regional relocations, up from 45% in 2021. On the outflow side, the Midwest is the biggest sender, accounting for just over one-third (35%).

We can also see that a smaller share of people are leaving the Northeast (20% of all movers) since 2021, and more are leaving the West (24% of all movers).

As pandemic-driven relocation cools, the Sunbelt can no longer coast on cheap rents alone, and markets that fail to build enduring value will be left behind. Winners will be markets that invest in sustainable draws: creating jobs, curating lifestyle amenities and diversifying economic engines to keep residents engaged and demand resilient.

2. Housing cost burden is reaching record levels, outpacing income growth for renters and owners

In 2022, the census reported a record 24.7% of renters who are severely rent-burdened, defined as spending more than 50% of their household income on rent. Owners are facing rising costs, too. As shown in the following chart, 2023 is the first year where renters and owners have been experienced slower growth in income than housing costs, leading to reduced overall purchasing power.

This trend is most pronounced in the Sun Belt states. In the maps below, we see that owner costs are growing fastest in Florida, where it has grown more than 30% since 2018, followed by Texas and Louisiana. Renter costs are skyrocketing in Arizona, Nevada, and Utah, each seeing increases in the low-thirties.

This broad erosion of purchasing power stands to undermines long-term demand. Markets that buck this trend, balancing income and housing cost growth, offer the most resilient opportunities. Addressing this dynamic head-on through cost-efficient construction and rent-stabilization mechanisms will be essential to sustaining healthy occupancy and returns.

3. More people are choosing to cohabit with non-family members

Households are forming at a faster rate than US population growth—and have been since 2016. 2023 marked the seventh year in a row that household formation outpaced population growth, doubling its pace despite some slowdown. As seen in the chart below, the pandemic accelerated this trend as more people sought shared housing to ease rental burdens. Non-family household formation, visualized in green, led this trend: between 2022 and 2023, the number of non-family households grew 1.6%, compared to sub-0.5% population growth. Even with a post-pandemic decline in household creation, new households are still forming at a faster rate than population growth.

This shift reflects changing living preferences and points to sustained demand for multifamily housing—a pattern CBRE has deemed a multifamily resurgence. This structural shift presents a clear opportunity: amenity-rich, flexible leases and efficiently designed shared units stand to capture demand as this trend persists.

Conclusion

Drawing on the Census Bureau’s American Community Survey as a cornerstone data source, our analysis shows that going into 2026, a convergence of cooling Sunbelt migration, escalating cost burdens and the rise of shared-housing arrangements will fundamentally realign residential markets.

Although the South still draws nearly half of all inter-regional movers, slowing migration and stagnant wage growth mean only markets that tackle affordability head-on will sustain healthy returns.

These conditions require that developers move beyond headline migration figures and zero in on regions where growth matches real purchasing power. Prioritizing cost-efficient construction, flexible lease offerings and amenity-rich co-living models will enable developers and investors to deliver housing that meets shifting demographic needs while preserving long-term value.