Austin, Texas, a longtime migration hotspot, has seemingly fallen out of favor with relocating homebuyers. According to a Redfin release, more homebuyers looked to leave Austin than move in during the third quarter.
That’s the first time on record there hasn’t been a net inflow into the Texas capitol. Redfin’s records go back through 2017. To put it into perspective, the number of Austin-based Redfin.com users looking for homes outside the metro area has more than doubled over the last year.
The data marks a significant change for Austin. The city formerly was a draw for out-of-town homebuyers looking for affordable homes – even before the pandemic. The onset of the pandemic proved to only increase Austin’s popularity, with remote work opportunities and record-low rates. Redfin says the city was the number-one U.S. migration destination at the beginning of 2021.
Several factors have contributed to the Austin fad dying down, particularly rising home prices. The gap between Austin’s home prices and those of where homebuyers commonly move from, like Los Angeles and San Francisco, is smaller than it used to be.
Other factors include monthly mortgage payments doubling and a call for workers to return to the office.
However, slowing migration is good news for Austin locals looking to buy. Austin’s median home price is down about 5% year over year, the biggest decline in the U.S., and it’s down nearly 20% from its pandemic peak.
“I’m telling buyers that this is the first time in years they can get a deal on a house, even with high mortgage rates,” said Austin Redfin Premier agent Carmen Gioia. “It’s probably a better time to buy down than waiting for mortgage rates to drop, because once that happens, competition will escalate and prices will shoot up. Right now, buyers are able to take their sweet time, negotiate with sellers, and buy a home without getting into a wild bidding war.”
Redfin’s data suggests that homebuyers leaving Austin are most commonly moving to other places in Texas. San Antonio and Corpus Christi are two of the three most popular destinations for Redfin.com users moving away from Austin; the other, conversely, is Denver.
Trending Moves
Nationwide, Redfin says the share of homebuyers relocating to a different metro area is still near record highs. Roughly one-quarter (25.9%) of homebuyers looked to move to a different part of the country in the third quarter. That’s essentially flat from the record high of 26% hit in August, and up from 24% a year ago and about 19% before the pandemic began.
There are 9% fewer Redfin.com users looking to move away from their home metro than a year ago–the biggest annual drop on record. But out-of-town home searches are holding up better than in-town searches: There are 17% fewer Redfin.com users searching within their home metro than a year ago.
