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Released Monday by the online brokerage Redfin, the report shows that 24.6 percent of Redfin users were looking to move to a new area during the fourth quarter of 2022, as the combination of high housing costs in most major cities and the freedoms provided by remote work inspired home searchers to seek out more affordable locales.
The fourth quarter of 2022 saw the overall pool of homebuyers shrink dramatically in size from the first half of the year due to the steep rise in mortgage interest rates, which made homes significantly more expensive for homebuyers. That same factor is what’s driving the home searchers who are left to more affordable areas of the country, Redfin says, as they seek to make their dollar go further in the elevated-rate environment.
Twenty twenty-one and 2022 saw Sun Belt markets like Phoenix, Las Vegas and Austin skyrocket in popularity with relocators due to their sunny climates and relatively low housing costs compared to coastal markets. The latter half of the year saw the relocation craze die down in those cities as many buyers found themselves priced out. But for those with the means to relocate, the Sun Belt market remained popular during the fourth quarter, according to the report.
“There are still out-of-towners buying homes and moving here full time, though that has also slowed down over the last several months as mortgage rates have risen,” said local Redfin agent Heather Mahmood-Corley. “Still, the cost of living in Phoenix is low compared to places like the Bay Area, Seattle, Denver, and parts of the East Coast, where many out-of-towners are coming from. I helped one client buy a home in Washington State in 2016, and it has doubled in value. She sold that home last year and used the proceeds to buy a much bigger, nicer house in Phoenix.”
The three most popular areas for relocators during the fourth quarter were Sacramento, Las Vegas, and Miami, according to Redfin, followed by Tampa and Phoenix.