Only These Two Non-Texas Counties Cracked the Top 10 for Population Growth Last Year

Article originally posted on CoStar on March 19, 2024

Recently released data from the U.S. Census Bureau reiterated Texas’ demographic dominance.

According to the bureau’s 2023 Vintage Population Estimates, the Lone Star State had eight of the top 10 fastest-growing counties in the United States from July 1, 2022, to July 1, 2023. That performance was an improvement from the previous year when Texas captured six of the top 10 spots.

The only two counties outside of Texas that ranked in the top 10 were Maricopa County, Arizona, which comprises the bulk of the Greater Phoenix area, and Polk County, Florida, which contains the Lakeland-Winter Haven area.

Both counties benefit from the longstanding trend of population migration to the Sun Belt and are perennially in the top 10 rankings. Common characteristics in both areas that draw residents and businesses include relative housing affordability, attractive weather, a lower tax burden and job opportunities.

Maricopa County’s population base grew by 30,000 people last year, an increase of 0.7%. While that result made Maricopa the fourth fastest-growing county in terms of absolute growth, it is a noticeable slide down the rankings, compared with 2021 and 2022, when Maricopa led the nation.

A pullback in domestic net migration was the primary culprit for the softer performance. About 2,200 U.S.-based residents moved to Maricopa County last year, a fraction of the 33,000 movers in 2022 and 43,000 movers in 2021. When factoring in migration from foreign countries, about 17,400 more people moved into Maricopa than moved out.

Nevertheless, the Valley maintains a strong position demographically, and the underlying drivers attracting folks to Phoenix remain in place. The local economy continues to grow and diversify, providing quality job opportunities for potential residents. In the works are several large manufacturing projects related to semiconductors, electric vehicles, renewable energy and aerospace, which should broadly support economic growth and demand for all types of real estate.

The cost of living also is meaningfully lower than in many expensive gateway markets. While home prices and rents have surged since the onset of the pandemic, Phoenix still offers a relative discount to places in California and the Pacific Northwest, attracting residents.

Connecting the larger Orlando and Tampa markets and situated along the pivotal Interstate 4 corridor in Central Florida, Polk County has the fastest rate of population growth in Florida. While notably smaller than Maricopa County, this area serves as a critical link between two of Florida’s top markets, and population growth is mainly driven by its relative affordability, compared with its larger neighbors. The cost of owning a home is roughly 24% less in Polk County than in either Orlando or Tampa, and the average apartment is approximately 12% less.

The rate of both natural change (or the birth rate minus the death rate) and international migration remain modest, but domestic migration has been strong for the past three years. Residents priced out of larger Florida markets are moving to Polk County, with many settling in the Davenport and Champions Gate areas in the northeast part of the county, where the urban cores of both Orlando and Tampa are reachable in roughly one hour. In fact, during 2023, the rate of net migration was nearly equal to the total rate of population change for the year.

At the center of Florida’s distribution chain, Polk County also has a large concentration of logistics, supply chain and distribution companies that can reach nearly 20 million people with same-day delivery. Its regional connectivity, lower cost of living and business incentives have attracted such companies as Publix Super Markets, Amazon and Coca-Cola.

Maricopa and Polk counties are well-positioned for growth in the years ahead. They offer affordability, compared with regional peers, while also providing proximity to major economic drivers and employment centers.

While the job growth rate in Phoenix slowed during the second half of 2023, its longer-term outlook remains healthy, according to Oxford Economics. The tech sector, in particular, is expected to be strong. A new semiconductor plant in Chandler is scheduled to open this year, and a fabrication plant for Taiwan Semiconductor Manufacturing Co. is underway on a building north of Phoenix that could start production in 2025. Those projects will help fuel population growth, possibly from 1.2% to 1.3% annually through 2028, with healthy rates of in-migration.

Polk County’s population grew at one of the fastest rates in the nation between 2021 and 2023, but the growth rate is expected to slow to between 1.8% and 1.9% annually through 2028. In-migration is projected to total just under 75,000 people, and the greatest contributions to gross domestic product growth are expected to come from the wholesale, retail, finance and real estate sectors.