man standing on texas lake dock staring at colorful sunset

Texas named the number two retirement state, according to Osher Lifelong Learning Institute

According to a study by the Osher Lifelong Learning Institute, Texas has leaped over California and Arizona to claim the number two retirement destination state in the country. Florida retains the number one position, attracting over 16 percent of all retirees who move across state lines.

Don't Mess With Texas

At 6.77 percent, Texas still has a long way to go before capturing the number one position. However, recent trends suggest that Florida’s dominance as the number one retirement destination is slowly slipping. From attracting a high of 26.3 percent of retirees who move across state lines in 1980, Florida slipped to 19.1 percent in the 2000 census. The current downturn of the Florida real estate market, combined with the rising popularity of other retirement states, will likely cause the declining Florida retirement trend to continue. As 55places.com recently reported, some estimates suggest more people are leaving Florida than moving to it.

What is most surprising about the NCCCR’s study is that Texas was able to leap over both California and Arizona to claim the number two position. After all, these two states have long been retirement Meccas and are home to far more active retirement communities than Texas. There are currently over three-dozen active retirement communities in Arizona. Plus, there are over 50 active retirement communities in California. Texas has only recently emerged as a player in the 55+ active adult community market.

Active Adult Living in Texas

Texas’ first large-scale active adult community, Sun City Texas, broke ground in 1996 and is still underway. More recently, Del Webb has added active adult communities like Frisco Lakes outside of Dallas, Hill Country Retreat in San Antonio and will soon be opening a new community in Houston.

Other active adult developers have taken notice of the rise in the number of retirees choosing Texas. Robson Communities, popular for their active adult communities in Arizona started a new development, Robson Ranch, outside of Dallas. The community will contain 7,200 homes, three 18-hole golf courses, several clubhouses, indoor and outdoor pools, a state-of-the-art fitness center and more. Unlike most 55+ age-restricted communities, however, Robson Ranch allows residents age 40 and older to reside in the community. Clearly, there are many draws to retiring to Texas.

Plenty of Good Reasons to Settle Down in Texas

The state is home to a diverse landscape that includes Gulf Coast, Hill Country, Piney Woods, and Desert Southwest. Retirees are graced with mild climates and warm temperatures year-round. The state’s economy remains strong, drawing a large number of Fortune 500 companies. While a large employment base may not mean much for retirees, it does draw the children and grandchildren of the 55+ population. Of course, where grandkids go, grandparents tend to follow.

In addition, the state boasts no income tax for its residents. However, as a word of caution to those retiring to Texas with the idea of finding a tax-free haven, it should be noted that in the 2008 book, “America’s Best Low-Tax Retirement Towns,” five cities in Texas fell into the “Tax Hell” category as a result of high property taxes.

The NCCCR’s study compiled data from 2.5 percent of the population. The study used data from 2005 as it was the most recent year that data was available. According to the study, retirement migration to the ten most popular retirement states of people age 60+ looked like this:

  1. Florida: 16.61%
  2. Texas: 6.77%
  3. Arizona: 6.60%
  4. California: 5.28%
  5. Georgia: 3.63%
  6. North Carolina: 3.50%
  7. Pennsylvania: 3.05%
  8. Tennessee: 2.93%
  9. Washington: 2.86%
  10. New York 2.55%

While the numbers do not lie, some people have questioned the long-term moving intentions of those surveyed. The study was conducted near the height of the real estate boom when prices in Florida, California, and Arizona were spiraling upwards. The hysteria drove many retirees to consider other, more affordable places for retirement. Texas, home to wide open spaces and readily available cheap labor, emerged as a likely choice for many who wanted to retire on a budget.

Now that prices have come back to reality in the popular southern retirement states such as Florida, Arizona, California, and Nevada, it will be interesting to see how age 55+ homebuyers’ attitudes will change. It is our opinion that while Texas will remain a strong player in the retirement destination category, it will not remain the number two destination. When the dust settles on the turmoil created by the recent real estate downturn, we expect to see Arizona and California right where they left off—numbers two and three.