Texas Real Estate Trends: New California Businesses Are Moving to Texas

Texas, get ready for the invasion! In an unprecedented move, thousands of new and established businesses are exchanging California’s West Coast climate for the Lone Star State.

The majority of companies making the move from California to Texas are in Big Tech. Silicon Valley has long been seeking greener pastures, as the state becomes more expensive and difficult to live and work in.

Companies like Tesla and Apple have announced their moves to Texas, with the world’s richest man and Tesla CEO Elon Musk even making the move to Austin himself. 

But, it’s not just the tech guys who are heading south. Big real estate companies like CBRE Group—America’s biggest commercial real estate services firm—and financial services powerhouse Charles Schwab have moved their headquarters to Dallas and Denton County, respectively. 

If you’re new to the real estate world, you might be wondering how this mass influx of new businesses will affect your investment.

Here’s how the tidal wave of California businesses moving to Texas is affecting the real estate market.

Lower taxes and fewer regulations = higher real estate prices

While California has been known as a great environment for startups, it’s long been known that companies tend to depart as they become more established. The Golden State is known for its high taxes and expensive real estate, as well as its strict regulations regarding environmental protections and the development of consumer products. These factors make it less attractive to business owners.

Texas is also known as being a “business-friendly state,” with lower taxes for businesses and more affordable housing options for employees. What’s more: the COVID-19 pandemic has driven most workforces to remote arrangements, giving workers and owners more options for where they choose to settle.

With companies moving all or some of their operations to Texas, you can expect to see more of their employees make the move, too. Tech CEOs like Elon Musk have been snapping up Texas real estate for both personal and business purposes.

This means that you can expect higher prices on commercial and residential real estate, as the increased demand outstrips the supply. If you’re a seller in the Texas real estate market—especially if you’re in “boomtowns” like Austin and Dallas—expect your property to get snatched up quickly.

SpaceX’s Starbase—also known as the Boca Chica Launch Site—is located in Brownsville, Texas. Elon Musk has been publicly encouraging people to move to the small town of Boca Chica, as the rocket company intensifies its search for the best and brightest engineers, technicians, and other workers. Perk your ears up if you’re looking for the next great real estate investment opportunity—where the big dogs go, growth follows.If you’re looking to buy in Texas, don’t delay: prices are skyrocketing to unprecedented levels in high-demand markets! Texas may be a lot less expensive than Califonia (which is $552,800!) with a median house price of $195,000, but it’s still lower than the average median house price across the United States.  California buyers might be able to buy 2 homes instead of one!

A hot renter’s market

The high demand from California businesses for Texas real estate means home prices are rising, as well. As more business owners, big company C-suite executives, and high net worth individuals move from California to Texas, they’re on the hunt for a great place to live.

Texas is rich in culture, has warm weather, lower taxes, and fewer restrictions during what seems like a never-ending pandemic. The high quality of life in big Texas cities is super attractive to Californians who’ve grown accustomed to west coast living.

In cities like Dallas, low mortgage rates and a smaller supply of housing have led to a surge in home purchases. Real estate investors from outside of Texas have been jumping on this.

If you have a residential property in Texas that you’d like to rent out, this is great news. You can tap into a pool of people who might not have been interested in living in Texas before. The increased competition also means you can charge higher rents, and take advantage of the surge in demand.

Real estate investment isn’t just for big-money investors and pros. It’s a path toward wealth creation that’s accessible to people at different income levels, and with different life goals. Don’t be afraid to get into the game. Visit The Real Estate Way for more tips and news on the best real estate investment opportunities.