Pandemic spurs more real estate searches outside home metro area
Living in an urban area has a number of benefits, including a shorter commute and access to amenities such as shops and restaurants. It also has higher costs of living, which can often price out a large share of potential buyers.
With the onset of the COVID-19 pandemic and the increased use of remote work arrangements, people searching for a home have been more likely to look outside their current metro area for their next home. A report by the real estate company Redfin determined that a record share of home searchers were considering more distant properties.
Redfin made this determination based on a sample of 1 million users who visited the company's website to peruse properties in April and May. The report focused on 87 metro areas and excluded searches that were unlikely to precede a relocation.
The company considered a person to be seriously looking to move to a community outside their metro area if they reviewed at least 10 listings in that community. These homes also had to make up at least 80 percent of the person's searches.
Twenty-seven percent of Redfin users during this period were focusing their searches outside their immediate metro area. This share was up from 26 percent in the first quarter of 2020 and 26.2 percent in the second quarter of 2019.
Redfin determined that while the number of page views of homes in cities with more than 1 million residents were up 22 percent compared to the previous year in May, views of homes in cities a population of 50,000 or less rose 87 percent.
"While there has been a huge increase in the number of people looking online at homes in small towns, the long-term impact of the pandemic on people actually moving from one part of the country to another remains to be seen," said Redfin economist Taylor Marr. "People are starting to take the plunge and move away from big, expensive cities, though most of them were probably already considering a lifestyle change. The pandemic and the work-from-home opportunities that come with it is accelerating migration patterns that were already in place toward relatively affordable parts of the country. But for many people, the lure of large homes in wide open spaces will be a passing dream fueled by coronavirus-induced isolation. "
In comparing the numbers of people looking to leave a city with the number of those looking to move in, the largest net outflows were in New York, San Francisco, and Los Angeles. Several other cities saw a modest increase in the number of people looking to move away compared to last year.
New Yorkers were most likely to search for homes in Atlanta. Californians were more likely to stay in state, eyeing cities like Sacramento and San Diego.
"People have always left the Bay Area for less expensive places. And Las Vegas and Lake Tahoe have always been popular destinations because home prices are lower and there's no state income tax in Nevada," Marr said. "As more companies follow in the footsteps of Facebook, Twitter and Slack in announcing permanent remote work policies, some tech workers are moving to different parts of the country – but most of them have other reasons to stay put, like friends, family and culture."
The cities with the highest net inflow were Phoenix, Sacramento, and Las Vegas, all of which were swelled by searchers from Los Angeles or San Francisco. Nashville had the largest increase in outside searchers compared to 2019, with 35 percent of home searches coming from people outside the metro area – up from 29.1 percent the year earlier.
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