May 20, 2005
Local polls in Los Angeles suggest 33 percent of the city's residents are ready to leave. In addition to California's decaying public infrastructure, residents constantly complain about the price of houses and the never-ending car commutes. So for malcontented residents paying such a high price for misery, 2005 is the year to sell your house and pick up stakes, says Rich Karlgaard of Forbes.
But where should the urban coastal transplants go? Karlgaard says for the money, the best quality of life is in university cities in Red States. Consider:
- A $1 million house in Santa Monica will only cost $134,000 in Knoxville, Tenn.; $187,000 in Austin, Tex.; $193,000 in Provo, Utah; $197,000 in Tucson, Ariz.; $203,000 in Athens, Ga.; $246,000 in Fort Collins, Colo.; and $280,000 in Charlottesville, Va.
- Add another 50 percent to those prices to get into better school districts, and the price of a comparable-sized home is still cheap compared to California or New York.
Karlgaard says real estate investment in these university cities have a good chance of growing for four reasons:
- All of the cities mentioned are situated in states that will outgrow the U.S. general population between 2000 and 2030.
- University cities tend to be the faster-growing cities within the fastest-growing states.
- Employers hoping to tap younger, cheaper talent in IT, biotech and nanotech -- but wanting to avoid the still-cheaper but riskier bets of offshoring to India and China -- will find it in American heartland university cities.
- Broadband wireless will soon close what information gap remains between America's big and small cities.
Moreover, the sophistication gap between the coasts and interior America is shrinking. Karlgaard claims that Google, FedEx and free trade make heartland living a much richer experience than it was a generation ago.
Source: Rich Karlgaard, "California Leavin?" Forbes, May 23, 2005.
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