According to a new report by H&R Block based on 2022 tax data, middle-class Americans are relocating to cities in Arizona, Nevada, Florida, and Texas in search of an affordable lifestyle. Surprisingly, Las Vegas has emerged as one of the most popular destinations for middle-class movers coming from out of state.

Realtors on the ground confirm that Las Vegas is becoming an attractive option for those seeking affordable homes and low taxes. Real estate agent Andrew Arevalo, who is licensed in both Nevada and Colorado, states, "It's weird to say this out loud, but I feel like Vegas is the new Colorado. It has shifted from Denver getting a lot of people from out of town to Vegas. It has now officially taken over."

H&R Block defines middle-class Americans as individuals with an adjusted median household income between $45,000 and $145,000, based on Pew Research Center guidelines. The data used for the report comes from the 4.6 million people in this income bracket who filed taxes with H&R Block.

In Clark County, where Las Vegas is located, there are currently more than 13,000 homes listed for sale, contributing to the lower home prices. The median sales price of a home in Las Vegas in September was $410,000, significantly lower than Denver's median price of $568,500, where the housing market has become less affordable.

Denver has long been a popular choice for movers attracted by its access to nature, high-quality jobs, safety, and thriving cannabis and craft brewery industries. However, the city's population growth has slowed due to housing affordability issues. In contrast, Las Vegas' population has grown by about 10% between 2010 and 2020, and it continues to attract newcomers, particularly from California, who are enticed by Nevada's lack of personal income tax.

Las Vegas is not the only city experiencing an influx of new residents. Phoenix, Arizona, takes the top spot as the most popular destination for both in-state and out-of-state middle-class movers in 2022. Real estate agent Stephanie K. Dow states, "We've got a lot of people moving from California." However, the high cost of living in California has spilled over into Arizona, impacting housing affordability. The median sales price for a home in Phoenix peaked at $470,000 in 2022, compared to $261,000 in 2019.

Meanwhile, San Antonio, Texas, ranks as the third most popular destination for out-of-state relocators and the fifth most popular for in-state movers, according to H&R Block. Texas, in general, has seen a surge in popularity during the pandemic, with a significant number of people relocating from California to Texas. While cities like Austin have witnessed a surge in home prices, San Antonio has managed to maintain its affordability.

Although realtors in Phoenix and San Antonio acknowledge the continuous influx of new residents, they believe that the peak experienced in 2020 and 2021 may not be surpassed. However, Arevalo believes that Las Vegas is poised to become the next big boom city, stating, "If you're not investing in Vegas, you might regret it. It's going to be the new LA. I don't even call it Las Vegas anymore. I call it Las Fornia."

The trend of middle-class Americans moving to affordable cities in these four states reflects the search for a better quality of life while considering cost of living and housing affordability. As more individuals seek a balance between their financial bottom line and their desired standard of living, cities like Las Vegas, Phoenix, and San Antonio offer enticing options.