TEXT OF STORY

LISA NAPOLI: Today we get word from the National Association of Realtors on how many existing homes sold across the nation in July. The numbers are likely to show a continued softening in the housing market. In parts of California, home sales have already fallen an average of 29%. Jeff Tyler looks at one possible reason for the dip.

---

JEFF TYLER: For decades, pop music has touted California as THE destination.

[ Song: "Going to California, bye-bye Sue. . ." ]

But California dreamin' and California reality are very different things.

[ Song: "I got the California blues." ]

A study produced by the moving company United Van Lines shows that in 2005 and the first half of this year more Americans checked out of hotel California than checked in.

Foreign immigration continues to bulk up California's total population, but United Van Lines spokeswoman Jennifer Bonham says domestic patterns reflect a demographic reversal.

JENNIFER BONHAM: "It's been more than 10 years since California has seen that many people leave. And most people seem to be moving towards the West, with the exception of California."

Jobs are also moving away.

Jack Kyser is chief economist with the Los Angeles County Economic Development Corporation.

He says employers pay more here for workers' comp, overtime and paid family leave. Kyser says companies increasingly expand elsewhere.

JACK KYSER: "It's difficult to do business in the state of California. It's expensive to hire anybody."

It's also an expensive place to live. Housing prices have skyrocketed.

PAMELA PERRELLA: "Although the home values have gone up, the quality of living has not. And it's very expensive to live here. So, I think a lot of people are looking at that, and thinking they can take the equity they have in a home, go someplace else and live a better quality of life."

That's Pamela Perrella.

She does customer service for Gemini Moving Specialists. She gets lots of calls about relocating out of California.

PERRELLA: "I talk to people all day long, every day, but I'm thinking of doing it myself." (:04)

[ Song: "I'm moving out ohhh. . . " ]

After more than 40 years in California, Perrella's ready for a change. Maybe Texas or North Carolina.

In Tennessee, Perrella says a 2000-square foot house is downright affordable.

PERRELLA: "For $200,000 you can buy a very nice home that you couldn't buy here for probably $600,000."

Economist Jack Kyser says, get this, some of the folks moving out-of-state keep their California day-jobs.

KYSER: "People who might live in Las Vegas, and they can fly into either Burbank or Los Angeles International on Southwest first thing in the morning and then fly out in the evening. And then they don't have the hassle of the high income taxes in the state of California. There is no income tax in the state of Nevada."

And it's not just Californians.

Overall, for Americans looking to relocate the favorite state is . . .

[ Song: Georgia instrumental ]

No. United Van Lines study shows the most popular state among movers is Oregon.

In Los Angeles, and happy about it, I'm Jeff Tyler for Marketplace.

NAPOLI: Me too. I'm Lisa Napoli. Enjoy your day.