A whopping 28.7 percent of Redfin.com users looked to move to a different metro area during July and August, according to the brokerage’s latest migration report, released Thursday. That figure rose from 27.4 percent during the second quarter of 2020 and marks its highest level since Redfin began tracking the data in 2017.
Redfin compiled the data from more than two million Redfin.com users who have searched for homes across 87 metro areas thus far during the third quarter.
As the coronavirus pandemic continues to impact Americans’ lives in significant ways, Redfin has seen buyers move out of more expensive and densely populated coastal markets to more affordable and spacious markets elsewhere.
“People who could barely afford to rent a one- or two-bedroom apartment in New York or San Francisco are finding that with their newly remote job, they can buy a nice-sized house in the most desirable part of a place like Sacramento, Tampa or Las Vegas,” Redfin Chief Economist Daryl Fairweather said in a statement. “And their big, coastal city salaries allow them to outbid local homebuyers in bidding wars, which is starting to drive up home prices in those areas. The trend is likely to continue as remote work becomes permanent for more companies.”
Approximately half of all Redfin.com searches in Sacramento, Tampa and Las Vegas were made by people from outside of town. As a result, the median home price in Sacramento soared 11.4 percent year over year, to $468,000 in August, while the median home price rose 12.8 percent in Tampa and 7.8 percent in Las Vegas.
Sacramento, Austin and Phoenix experienced the greatest net inflow (more people looking to move into the area than leave) during July and August, in that order of demand. Redfin’s report noted that while Austin is often featured in top 10 lists of popular destinations, this is the first time it’s made it in the top three spots since Redfin began tracking the data. All three metros serve as more affordable alternatives to pricier coastal markets nearby like San Francisco and Los Angeles.
New York, San Francisco, Los Angeles, Washington, D.C. and Chicago continued to see the biggest net outflows in July and August as they did during the second quarter.
“People are leaving New York City because they want bigger, better homes for the same price, and they can get them outside the city,” local agent Ken Wile said in Redfin’s report. “Many people who were living in relatively small $1 million or $2 million apartments no longer need to live close to their office because they’re working remotely, and now they want more space and a separate, quiet space for Zoom calls. Plus they want to take advantage of low mortgage rates.”
Although the number of Redfin.com users in New York looking to move declined from last year, the report noted that many New Yorkers searching for homes in other areas have already vacated New York’s metro area. Among the remaining top 10 netflow metros, all but Milwaukee experienced greater net outflow than the previous year.