Record-High 1 in 3 Homebuyers Looking to Relocate
A record 32.4% of Redfin.com users nationwide looked to move to a different metro area in January, up from the previous peak of 31.5% a year ago and significantly higher than before the pandemic, when one-quarter of homebuyers sought to relocate.
Redfin said the share of homebuyers looking to move has grown during the pandemic as remote work and low mortgage rates have allowed many Americans to relocate to more affordable regions with more indoor and outdoor space.
“The share of homebuyers looking to move to a different area will continue to rise throughout the year,” said Redfin Chief Economist Daryl Fairweather. “With mortgage rates going up and rents skyrocketing, moving somewhere more affordable is one of the only ways for many Americans to stay within their housing budget. Even workers who are unable to work from home should feel confident about finding a job in a new location with the tight labor market.”
Redgin said permanent remote-work policies and the ongoing housing shortage will also likely keep Americans moving. If a buyer becomes frustrated by a lack of inventory in one metro, they may relocate to a place with more affordable homes to choose from.
Miami was the most popular migration destination of all the major U.S. metros in January, unchanged from the third and fourth quarters. Phoenix, Tampa, Sacramento and Las Vegas rounded out the top five. Relatively affordable metros with warm weather are typically the most popular destinations among Redfin.com home searchers.
Although the five most popular metros are still affordable compared with coastal job centers such as the Bay Area and New York, home prices are rising rapidly. In Miami, the typical home sold for $436,900 in January, up 18.1% year over year and above the national median of $376,200. Still, that’s more affordable than the $655,000 median sale price in New York, the top origin of people moving to Miami.
“While Sun Belt cities like Miami and Phoenix aren’t likely to lose their luster anytime soon, rising prices may soon render them slightly less popular for relocators,” Fairweather said. “Home prices–and the costs of other goods and services–are skyrocketing in a lot of these destinations precisely because they’re so popular with out-of-towners. Some homebuyers who prioritize affordability may start searching in less expensive northern cities.”
San Francisco, Los Angeles, New York, Seattle and Washington, D.C., ranked highest among metros in which homebuyers looked to leave in January, unchanged from the fourth quarter. With a median sale price of nearly $1.4 million, San Francisco is the most expensive place to buy a home in the country. Los Angeles, New York and Seattle aren’t far behind.
