The Scottsdale Relocation Index · Inaugural Issue
Published May 2026 · By Anne Sostman | The Scottsdale Agent
The Scottsdale Relocation Index
Q1 2026.
A Quarterly Read on Luxury Relocation to Scottsdale, Paradise Valley, and Arcadia
The inaugural issue of The Scottsdale Relocation Index. A quarterly publication anchored in IRS migration data, Tax Foundation analysis, Cromford Report luxury segment data, and Arizona Regional MLS closings. Published with full citations, methodology disclosure, and qualitative analysis from direct observation of luxury relocation transactions. The data tells one story. What it means for buyers, sellers, and the trajectory of the Scottsdale luxury market is the story this Index is built to tell.
— Anne Sostman | The Scottsdale Agent
IRS Migration Data
Tax Foundation Analysis
Cromford Report
Arizona Regional MLS
Q1 2026 Closings
Executive Summary
Q1 2026 in Three Sentences,
Then the Detail.
One. The IRS migration data for tax years 2022 to 2023 (the most recent available) confirm that California, New York, Illinois, New Jersey, and Massachusetts continue to lose net tax filers to lower tax states, with Arizona ranking sixth nationally for net inbound migration at a gain of 17,316 filers. Maricopa County alone netted 18,884 inbound migrants from other states.
Two. The Phoenix metro luxury segment in Q1 2026 is outperforming the broader market by a wide margin. Per the Cromford Report, sales over $3M are up 26 percent year over year, and 26 ultra luxury closings over $10M occurred in Q1 alone — already 81 percent of the full year 2025 record before the quarter closed. Approximately 102 active properties are listed above $10M.
Three. The relocation flow into Scottsdale and Paradise Valley luxury is concentrated in specific origin to destination patterns that this Index will track quarterly going forward. Q1 2026 saw the typical California to North Scottsdale flow continue, alongside emerging strength in New York to Paradise Valley and Massachusetts to Arcadia paths. The qualitative analysis section below covers what these patterns mean for buyers and sellers entering the market right now.
Section One: Migration Data
The IRS Migration Data,
State by State.
The IRS Statistics of Income migration files track domestic migration based on year over year address changes on individual income tax returns. The most recent data available covers tax years 2022 to 2023. While newer than 2024 to 2025 data is not yet released, the patterns documented are stable and directional for current relocation flows.
| State | Net Filer Change 2022 to 2023 | Top State Income Tax Rate | Direction |
|---|---|---|---|
| Arizona | +17,316 | 2.5% flat | Net inbound |
| Texas | +56,473 | No state income tax | Net inbound |
| Florida | +55,349 | No state income tax | Net inbound |
| California | −100,397 | 13.3% top rate | Net outbound |
| New York | −71,987 | 10.9% state plus 3.876% NYC | Net outbound |
| Illinois | −28,609 | 4.95% flat | Net outbound |
| Massachusetts | −15,378 | 5% plus 4% surtax above $1M | Net outbound |
| Washington | Mixed (gains in returns, smaller in individuals) | 7% to 9.9% capital gains only | Mixed |
| Colorado | +11,341 | 4.40% flat | Net inbound |
Source: Tax Foundation analysis of IRS Statistics of Income migration data, tax years 2022 to 2023. Net change in income tax filers from interstate migration. Top state income tax rates current for tax year 2025. The IRS withholds county to county data when fewer than 20 filers move between any two counties, so some flows are necessarily aggregated. Date pulled May 2026.
Section Two: County Level Flows
Where Maricopa County’s New Residents
Are Coming From.
Maricopa County (Phoenix metro, including Scottsdale and Paradise Valley) absorbed 18,884 net domestic migrants in tax years 2022 to 2023 — the highest of any Arizona county. Per the IRS data, the top originating counties tell a clear story about where the relocation pressure is coming from.
| Originating County | Migrants to Arizona | Major City |
|---|---|---|
| Los Angeles County, CA | 11,558 | Los Angeles |
| San Diego County, CA | 8,433 | San Diego |
| Riverside County, CA | 6,311 | Riverside, Palm Springs |
Source: IRS Statistics of Income migration data, county to county flows, tax years 2022 to 2023. Note: County level data is filtered by the IRS to maintain confidentiality where fewer than 20 filers move between specific counties. The figures shown represent the top three California county sources to Arizona; smaller flows from Cook County (Chicago), King County (Seattle), and other major metros also contribute meaningfully but are not always disclosed at the county to county level. Future issues of this Index will track county to county flows as new IRS data is released annually.
The dominance of California in the originating county data is consistent with what is observed in luxury relocation transactions. Of the buyers I have personally worked with on relocation purchases in Scottsdale and Paradise Valley over the past 24 months, the largest single origin cohort has been California, followed by New York and Illinois. The county level IRS data confirms what the buyer pipeline already suggests.
Section Three: High Net Worth Flows
The AGI Migration Story
Is the Real Story.
The headline migration numbers tell you how many people are moving. The AGI (Adjusted Gross Income) flow data tells you who they are. For the luxury relocation segment that this Index tracks, AGI flows are the more important indicator.
Per Tax Foundation analysis of the most recent IRS data, among taxpayers with $200,000 or more in AGI, the most attractive destination states were Florida, Texas, North Carolina, South Carolina, and Arizona. The states losing the most affluent taxpayers were California, New York, Illinois, Massachusetts, and New Jersey.
In a single year, California lost 24,670 taxpayers with $200,000 plus AGI, reducing the state’s combined AGI base by approximately $16.1 billion. That is the cohort buying $3M plus homes in Paradise Valley, Silverleaf, and Arcadia. The Index will track this AGI flow quarterly as new data becomes available.
Section Four: Q1 2026 Luxury Segment
The Luxury Market Is Outperforming
By a Wide Margin.
The Cromford Report Q1 2026 analysis of Phoenix metro housing data confirms a sharp divergence between the luxury segment and the broader market. Sales over $3M are up 26 percent year over year. Sales over $10M (the ultra luxury tier) are running ahead of pace to potentially exceed the 2025 record of 32 transactions for the year — already 26 closed in Q1 alone.
| Segment | Q1 2026 Performance | Context |
|---|---|---|
| Sales over $3M | +26% YoY | The strongest segment in the Phoenix metro market. Materially outperforming the under-$2M tier. |
| Sales over $10M (ultra luxury) | 26 closings in Q1 | Already 81 percent of full year 2025 record (32). Q1 is on pace to exceed the 2025 annual figure within the year. |
| Active $10M+ listings | ~102 active | Inventory at the top end is meaningful. Buyers have selection. Sellers have competition. |
| Phoenix Metro median sale | $925,000 (Scottsdale) | Down 8.6% YoY citywide Scottsdale aggregate. The headline number is misleading without the band breakdown. |
| Mortgage rate environment | ~5.99% to 6.20% | Stabilized below 6.20% since late 2025. Cash buyers (typical at $5M plus) are insulated from rate volatility. |
| Cromford Demand Index | 13% below normal | Improving from 16% below normal a month earlier. Recovery trajectory is consistent with relocation flow patterns. |
Source: Cromford Report, Q1 2026 commentary by Tina Tamboer, Senior Housing Analyst. Data from the Arizona Regional Multiple Listing Service. The Cromford Report is the standard reference source for Phoenix metro housing data and is licensed from ARMLS.
Section Five: Anne’s Analysis
What the Q1 2026 Data
Actually Means.
The data sections above are facts. The analysis below is opinion — informed by direct observation of luxury relocation transactions, but opinion. It is labeled as such so the reader can separate evidence from interpretation. Every Index issue going forward will preserve this distinction.
The headline migration story is misleading without the AGI overlay.
Arizona ranks sixth nationally for net inbound tax filer migration. That sounds modest. But Arizona ranks fifth nationally for inbound migration of taxpayers with $200,000 plus AGI. The high earner cohort is overrepresented in Arizona’s inbound flow, which is exactly why the luxury segment of the Phoenix metro market is materially outperforming the broader market. The migration numbers and the luxury sales numbers are not two separate stories. They are the same story, told from two different angles.
The 26 percent YoY increase in $3M plus sales is not a peak. It is a trend line.
The Cromford Report’s Q1 2026 commentary frames the luxury segment as having an “extraordinary season.” That language understates the structural nature of what is happening. The same buyer cohort fleeing California’s 13.3 percent income tax, New York’s 14.8 percent combined rate, and Massachusetts’s new $1M surtax is not going to reverse course in 2027. Luxury demand in Scottsdale and Paradise Valley is being driven by a tax structure decision that is, for most relocators, permanent. Future Index issues will track whether the trend line continues or whether saturation sets in.
The Massachusetts surtax has changed the New England flow.
In 2022, Massachusetts passed a 4 percent surtax on individual income above $1M, effective 2023. The state has reportedly collected over $3B per year from the surtax. The IRS data shows Massachusetts losing 15,378 net tax filers in 2022 to 2023 — and the relocation flow specifically among Boston area high earners has accelerated noticeably in the buyer conversations I have had over the past 18 months. The Boston to Scottsdale and Boston to Naples flows are the two paths I would expect to see grow in the Q2 and Q3 2026 data.
The submarket pattern within Scottsdale relocation is not random.
Of the relocation buyers I have worked with on luxury purchases over the past 24 months, the submarket clustering breaks down into three distinct patterns. California buyers concentrate in DC Ranch, Silverleaf, and Paradise Valley — they understand master planned and guard gated communities and want the closest analog to their existing lifestyle. New York buyers concentrate in Old Town Scottsdale and Arcadia — walkable urban or central residential, often as a second home before a full relocation. Texas buyers concentrate in Paradise Valley and the Camelback Country Club corridor — comparable land sizes to what they had, with the Arizona tax structure as the primary driver. These patterns are observational, not statistical, but they have held consistently across enough transactions to feel like signal rather than noise.
What this Index will track in Q2 2026.
The Q2 2026 Issue (publishing August 2026) will report on April through June 2026 closings, with three new data points layered into the analysis. First, the breakdown of luxury closings by likely originating state, where ARMLS field data permits identification. Second, an inventory analysis of $3M plus active listings by submarket. Third, an updated read on the Cromford Demand Index trajectory. The goal is for the Index to become more analytically useful with each issue as the trend lines compound.
Section Six: Methodology
How Each Number
Was Sourced.
The defensibility of the Index depends on every reader being able to verify the numbers themselves. Every data point above is sourced. Every methodology decision is documented. Every limitation is named. This section is the audit trail.
IRS migration data: Statistics of Income (SOI) Tax Stats, U.S. Population Migration Data. Annual study based on year over year address changes on Form 1040 returns. Most recent data covers tax years 2022 to 2023, released by IRS in late 2024. State to state and county to county flows. The IRS suppresses county to county flows where fewer than 20 filers moved between any two counties. Limitation: late filers are excluded from the data. Limitation: the data lags 18 to 24 months from the actual move year.
Tax Foundation analysis: Independent tax policy organization based in Washington DC. Their state migration trends analysis aggregates the IRS SOI data with state tax structure context. Citation pulled from Tax Foundation’s “State Migration Trends” report, updated annually. The Index relies on Tax Foundation analysis for the AGI breakdown and the state by state net migration figures.
Cromford Report: The standard reference source for Phoenix metro housing data, licensed from the Arizona Regional MLS. Daily updates with quarterly summaries published by Tina Tamboer, Senior Housing Analyst. The Cromford Report’s Q1 2026 commentary is the source for the luxury segment performance figures (sales over $3M, sales over $10M, mortgage rate environment, Cromford Demand Index).
Anne’s qualitative analysis: Based on direct observation of luxury relocation transactions over the past 24 months as the listing or buyer agent. The “submarket pattern” observations and the “Boston to Scottsdale flow” commentary are interpretive rather than statistical, and are labeled as analysis throughout. Future Index issues will quantify these observations as the transaction count accumulates.
Frequently Asked
About
The Index.
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What is The Scottsdale Relocation Index?
A quarterly publication tracking luxury real estate relocation patterns to Scottsdale, Paradise Valley, and Arcadia. Each issue is anchored in IRS migration data, Tax Foundation analysis, the Cromford Report, the Arizona Regional MLS, and direct observation from active luxury relocation transactions. Published by Anne Sostman, The Scottsdale Agent.
How many people are relocating to Arizona from California?
Per the most recent IRS migration data (tax years 2022 to 2023), Los Angeles County alone contributed 11,558 migrants to Arizona, San Diego County 8,433, and Riverside County 6,311. Maricopa County (Phoenix metro, including Scottsdale) received 18,884 net domestic migrants from other states, the highest of any Arizona county. California lost 100,397 net tax filers in the same period.
Where is the Scottsdale luxury market in Q1 2026?
Per the Cromford Report Q1 2026 analysis, sales over $3M in the Greater Phoenix area were up 26 percent year over year through Q1 2026, including 26 ultra luxury closings over $10M. Approximately 102 active properties priced above $10M were on the Arizona Regional MLS as of late Q1 2026. The luxury segment is materially outperforming the broader market, with Scottsdale and Paradise Valley as the primary drivers.
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Why is Arizona attracting high net worth relocators?
Arizona offers a flat 2.5 percent state income tax versus California’s 13.3 percent top rate or New York’s 14.8 percent combined rate. No estate tax, no inheritance tax, and a 25 percent subtraction on qualifying long term capital gains. Property tax rates roughly half of comparable luxury markets in the Northeast or West Coast. Beyond tax, Arizona offers 299 sunny days per year, direct flights from Sky Harbor to every major U.S. business hub, and luxury housing inventory at a fraction of comparable coastal pricing.
How often is The Index published?
Quarterly. Each issue covers the most recent complete calendar quarter and is released approximately four to six weeks after the quarter closes. Q1 2026 Issue (covering January through March 2026) published May 2026. Q2 2026 Issue scheduled for August 2026. Q3 2026 Issue scheduled for November 2026. Q4 2026 Issue scheduled for February 2027.
Can I cite the Index in my own publication?
Yes. The Index is published with the expectation that journalists, industry analysts, tax professionals, and other agents may reference its findings. Citation format suggested: “The Scottsdale Relocation Index, Q1 2026 Issue, by Anne Sostman, The Scottsdale Agent. Available at amsrealtyaz.com/relocation-index.” For press inquiries or to request the underlying data behind any figure cited, contact Anne directly at 480.999.9945.
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For Buyers and Sellers Acting on This Data
The Index Tells You What is Happening.
The Conversation Tells You What to Do About It.
A 30 minute private consultation about your specific situation. If you are a buyer evaluating a relocation, the Index is the starting point — what you do with it depends on your timeline, your origin city, your tax planning, and your target submarket. If you are a seller, the Q1 luxury segment data has direct implications for pricing strategy and timing. The Index is the data. The conversation is how it gets applied.
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