How Inflation Has Affected Moving Costs?

Post-Covid inflation has affected many aspects of our lives. One of the biggest changes that everyone can see is the higher cost of living. Besides obvious price increases that we can see in food, clothing, gas, etc. inflation also brought us pricier services. One of the instances where we can see significantly higher prices are moving services. And since inflation is making many people relocate in search of a lower cost of living, this fact is becoming more obvious. If you are planning to move, you are surely interested to learn about how inflation has affected moving costs. And in the following article, Best Cross Country Movers will talk about the problems moving companies face these days and how it all relates to their customers.

What causes the current inflation?

There is no definitive answer about what is causing inflation in America. Some will say that the government’s monetary policy is the main reason, others will blame the increased demand and goods shortages, while some will blame global political instability, wars, etc. Regardless of whether it is low-interest rates, growth of money supply or something third, a rise in prices across an economy is something that we all have to deal with, and hope that the storm will pass as quickly as possible. Now, we all know that the increase in the cost of living is affecting all aspects of our lives. But how does it affect the moving industry?

Shifts in migration patterns caused by current inflation

When we think about how inflation is affecting different sectors, the moving industry probably wouldn’t be the first one that we will think of. However, the moving industry is taking a major hit and has been one of the most affected industries until today. Increased gas prices, parking and toll prices, vehicle maintenance prices, packing materials prices, and minimum hourly wages have a big effect on moving companies, which in the end spills over to their customers.

Another reason why inflation has affected moving costs is the increase in demand for moving services. For 10 years straight, the overall number of moves in the country decreased each year respectively. It is estimated that 2022 was the first year in almost a decade when the number of relocations increased compared to the previous year. We do not have complete data for 2022 yet, but current estimates show that 4% more Americans moved than in 2021.

• 2017 – 34,902,000
• 2018 – 32,352,000
• 2019 – 31,371,000
• 2020 – 29,780,000
• 2021 – 27,059,000
• 2022 – 28,141,360 (current estimate)

Now, let’s see how inflation has affected moving costs

There are many reasons why moving today is going to be much more expensive than it was just a year before. And in the following lines, we will take a look at how inflation affected moving costs for the customers:

• Increased home prices
• Increased rent prices
• Higher mortgage rates
• Costlier moving services
• Pricier construction materials

Home price inflation

We already mentioned that this is the first year in almost a decade where the number of relocations increased compared to the previous year. The only logical continuation of this is that we will inevitably have an increased demand for homes, which, of course, leads to increased home prices. According to the latest data, the city of Farmington is the city where home prices increased the most in 2022 – home prices here increased by 20.3%. Nevertheless, it is still very affordable. So be sure to contact best cross country movers New Mexico if you want to take advantage of the current situation in the real estate market.

The list of the cities where real estate prices grew the fastest in the previous year

• Farmington, New Mexico – median home price in 2021 $208,176 – median home price in 2022 $261,200 – difference 20.3%
• North Port-Sarasota-Bradenton, Florida – median home price in 2021 $418,600 – median home price in 2022 $520,000 – difference  5%
• Naples-Immokalee-Marco Island, Florida – median home price in 2021 $664,470 – median home price in 2022 $802,500 – difference 2%
• Greensboro-High Point, North Carolina – median home price in 2021 $229,163 – median home price in 2022 $276,100 – difference 17%
• Myrtle Beach-Conway, S.Carolina/N.Carolina – median home price in 2021 $312,993 – median home price in 2022 $373,500 – difference 16.2%
• Oshkosh-Neenah, Wisconsin – median home price in 2021 $185,388 – median home price in 2022 $220,700 – difference 16%
• Winston-Salem, North Carolina – median home price in 2021 $240,423 – median home price in 2022 $285,200 – difference 15.7%
• El Paso, Texas – median home price in 2021 $207,336 – median home price in 2022 $244,500 – difference 15.2%
• Punta Gorda, Florida – median home price in 2021 $333,094 – median home price in 2022 $392,800 – difference 15.2%
• Deltona-Daytona Beach-Ormond Beach, Florida – median home price in 2021 $302,499 – median home price in 2022 $353,800 – difference 14.5%
• Fayetteville, North Carolina – median home price in 2021 $189,311 – median home price in 2022 $220,900 – difference 14.3%
• Fayetteville-Springdale-Rogers, Arkansas/Missouri median home price in 2021 $277,886 – median home price in 2022 $323,500 – difference 14.1%
• Lakeland-Winter Haven, Florida median home price in 2021 $291,952 – median home price in 2022 $338,300 – difference 13.7%
• Fargo, N.Dakota/Minnesota – median home price in 2021 $247,875 – median home price in 2022 $285,900 – difference 13.3%
• Port St. Lucie, Florida – median home price in 2021 $349,562 – median home price in 2022 $399,500 – difference 12.5%

National home price inflation since 2010

Those are the 15 cities where home prices increased the most between 2021 and 2022. Now let’s see housing inflation rates on a national level since we last saw negative inflation:

• 2010 – home price inflation rate – 0.37%
• 2011 – home price inflation rate + 1.32%
• 2012 – home price inflation rate +1.65%
• 2013 – home price inflation rate + 2.08%
• 2014 – home price inflation rate + 2.58%
• 2015 – home price inflation rate + 2.08%
• 2016 – home price inflation rate + 2.48%
• 2017 – home price inflation rate + 2.97%
• 2018 – home price inflation rate + 2.89%
• 2019 – home price inflation rate + 2.89%
• 2020 – home price inflation rate + 2.19%
• 2021 – home price inflation rate + 3.29%
• 2022 – home price inflation rate + 7.15%
• 2023 – home price inflation rate + 4.30% (incomplete data)

Rent price inflation since 2010

Along with real estate, we also saw an increase in rent prices. According to the latest data, 65.8% of Americans live in a home they own, while 34.2% rent. Similarly to housing prices, the last time we saw rent price inflation that was under 1% was in 2010. In 2022 and 2023, we saw the biggest inflation since 1985. According to the latest research, NYC is the city with the biggest year-to-year increase in rent prices between 2022 and 2023. Nevertheless, it is still one of the most popular move-to destinations in the country. If you want to make NYC your home, some of the best cross country moving companies New York are at your disposal. Until then, take a look at the cities where rent prices are the highest in 2023:

• New York City – median rent in December 2022: $3,738 – median rent in December 2020: $2,399 – Difference: 56%
• Jersey City – median rent in December 2022: $3,102 – median rent in December 2020: $1,825 – Difference: 70%
• Boston – median rent in December 2022: $3,009 – median rent in December 2020: $2,143 – Difference: 40%
• San Francisco – median rent in December 2022: $2,975 – median rent in December 2020: $2,668 – Difference: 12%
• Miami – median rent in December 2022: $2,705 – median rent in December 2020: $1,647 – Difference: 64%

National rent price inflation since 2010

Those will be the most expensive cities to rent a home in 2023. Now, here is rent price inflation since 2010 on a national level:

• 2010 – rent price inflation rate + 0.25%
• 2011 – rent price inflation rate + 1.71%
• 2012 – rent price inflation rate + 2.65%
• 2013 – rent price inflation rate + 2.83%
• 2014 – rent price inflation rate + 3.15%
• 2015 – rent price inflation rate + 3.57%
• 2016 – rent price inflation rate + 3.77%
• 2017 – rent price inflation rate + 3.81%
• 2018 – rent price inflation rate + 3.62%
• 2019 – rent price inflation rate + 3.71%
• 2020 – rent price inflation rate + 3.12%
• 2021 – rent price inflation rate + 2.25%
• 2022 – rent price inflation rate + 6.03%
• 2023 – rent price inflation rate + 4.91% (incomplete data)

Higher mortgage rates

Another not-so-obvious inflation factor that has affected moving costs is increased mortgage rates.  Now, even though, when we look at historical charts, we can see that mortgage rates are generally much lower than, let’s say, 40 years ago, in the last couple of years, 30-year and 15-year fixed rates increased.

• 15-year fixed mortgage rates 2021 – 2.27%
• 15-year fixed mortgage rates 2022 – 3.32%
• 30-year fixed mortgage rates 2021 – 2.96%
• 30-year fixed mortgage rates 2022 – 4.09%

Costlier moving services

We already talked about the increase in the cost of moving services. Now let’s take a look at the individual factors that affected this increase in those costs. First of all, it is important to understand moving companies already operate with minimum profit margins. That is why whenever they have increased expenses that will inevitably spill over to the customers. And in the last couple of years, moving companies had sensed an increase in:

• Gas prices
• Vehicle maintenance prices
• Increased toll prices
• Increased parking prices
• Higher minimal wage

Gas prices

According to the latest data, this state has the highest diesel fuel prices in the country. Besides Hawaii, moving companies in California, Maine, New York, Washington, and Pennsylvania also have trouble filling up their moving trucks. Nevertheless, the best interstate moving companies Hawaii are still offering good deals, so be sure to contact them if you are planning a move. Here are the 10 states with the highest gas prices in February 2023

• Hawaii – diesel fuel costs – $6.040
• California – diesel fuel costs – $5.675
• Maine – diesel fuel costs – $5.490
• New York – diesel fuel costs – $5.181
• Washington – diesel fuel costs – $5.045
• Pennsylvania – diesel fuel costs – $5.002
• New Hampshire – diesel fuel costs – $4.997
• Massachusetts – diesel fuel costs – $4.967
• Rhode Island – diesel fuel costs – $4.948
• Vermont – diesel fuel costs – $4.922

Pricier vehicle repair and maintenance costs

Besides gas prices, moving companies also suffer from increased vehicle maintenance costs. According to DMV data, the state of Michigan has the highest vehicle maintenance costs in the country. Despite that fact, some of the best cross country movers Michigan can still provide you with quality services and reasonable prices. So be sure to look for the best companies if you are planning a move to Michigan. Here are the states where movers suffer the most when it comes to vehicle maintenance:

• Michigan – vehicle repair and maintenance costs: $4,664
• Louisiana – vehicle repair and maintenance costs: $3,849
• Nevada – vehicle repair and maintenance costs: $3,705
• Kentucky – vehicle repair and maintenance costs: $3,614
• California – vehicle repair and maintenance costs: $3,457

If you are hiring movers from one of these states, your moving services will probably be more expensive due to this factor. On the other hand, If you are moving to the Pine Tree State, you should know that the best cross country movers Maine have the least trouble with vehicle maintenance since repair, parts, and labor costs here are the cheapest in the country.

Tolls costs

In the last couple of years, moving companies felt an increase in parking and toll prices as well. According to the latest data, Pennsylvania has the most expensive road when it comes to tolls – the Pennsylvania Turnpike. This road is more than 360 miles long and can cost your mover up to $200 in tolls, naturally, depending on the entry and exit points. However, if you do your research before the move and find the best cross country moving companies Pennsylvania, toll costs won’t be a significant factor in the final price of your move since the finest professionals know how to form their prices without taking every single aspect into consideration.

Parking costs

When it comes to parking costs, the most expensive city in the country is NYC. However, San Francisco is not far behind either. So, if you are planning to move to the Golden State, be sure to find the best interstate movers California as they won’t take parking costs into consideration when forming the price of your move.  Here are the 5 most expensive cities in the US when it comes to parking:

• New York City
• San Francisco
• Los Angeles
• Washington DC
• Chicago

Minimum wage increase

As of 2023, 26 states will increase the minimum wage. That is also one of the things that will affect your moving costs. At least in the states where the change applies. Here are the states where this change will become effective in 2023:

• Alaska 2022: $10.34  – 2023: $10.85
• Arizona 2022: $12.80 – 2023: $13.85
• California 2022: $15.00 – 2023: $15.50
• Colorado 2022: $12.56 – 2023: $13.65
• Connecticut 2022: $14.00 – 2023: $15.00
• Delaware 2022: $10.50 – 2023: $11.75
• Florida 2022: $11.00 – 2023: $12.00 effective 9/30/23
• Illinois 2022: $12.00 – 2023: $13.00
• Maine 2022: $12.75 – 2023: $13.80
• Maryland 2022: $12.50 – 2023: $13.25
• Massachusetts 2022: $14.25 – 2023: $15.00
• Michigan 2022: $9.87 – 2023: $10.10
• Minnesota 2022: $10.33 – 2023: $10.59
• Missouri 2022: $11.15 – 2023: $12.00
• Montana 2022: $9.20 – 2023: $9.95
• Nebraska 2022: $9.00 – 2023: $10.50
• New Jersey 2022: $13.00 – 2023: $14.13
• Nevada 2022: $9.50 – 2023: $11.25
• New Mexico 2022: $11.50 – 2023: $12.00
• New York 2022: $13.20 – 2023: $14.20
• Ohio 2022: $9.30 – 2023: $10.10
• Rhode Island 2022: $12.25 – 2023: $13.00
• South Dakota 2022: $9.95 – 2023: $10.80
• Vermont 2022: $12.55 – 2023: $13.18
• Virginia 2022: $11.00 – 2023: $12.00
• Washington 2022: $14.49 – 2023: $15.74

Prices of construction materials and labor have gone up

When moving to a new home, regardless of whether you are buying or renting, you will most likely have to do some repair and maintenance work on your new, or maybe even old, space. Unfortunately, inflation has not only affected the moving costs directly but also indirectly by affecting the cost of construction materials and labor. Again, we see that the highest construction material and labor can be found in Hawaii and California, however, according to this data, the state of Washington is pretty expensive in this regard as well. If you are planning to move here and you are bothered by expensive construction materials, at least try to mitigate that cost by hiring some of the best cross country movers Washington that will offer you a good deal on your moving price at least.

So how much will your move cost in 2023?

As you can see, inflation has affected moving costs in many different ways. So, how much can you expect to pay for your move in 2023? Right now, the average moving cost for a local move will cost you somewhere between $80 to $100 for two movers per hour. Long distance relocations, depending on the state and the distance you are moving to cost between $5,000 and $10,000