Redfin estimates the Phoenix metro gained roughly 85,000 residents from other metro areas in 2021, far more than any other metro, while Dallas gained about 56,000 and Orlando gained about 53,000. However, while hundreds of thousands of Americans flocked to Sun Belt cities last year in search of affordability, house prices are rising at a rapid rate.
The rush to the Sun Belt is largely due to many people from outside states—often remote workers—taking advantage of low mortgage rates. Nationwide, 31% of Redfin.com users looked to move to another metro in 2021, up from 25.6% in 2019, before the onset of the pandemic.
“Moving across the country is now easier for many Americans, thanks to remote work. That cultural shift is here to stay,” said Redfin deputy chief economist Taylor Marr. “What’s changing is the affordability of the most popular destinations. Some locals, particularly renters who aren’t able to take advantage of rising home values, are getting priced out of places like Phoenix and Austin as the cost of housing and other goods and services go up. New construction tends to be robust in sprawling Sun Belt cities, and local governments ought to continue to prioritize building new homes to keep up with ongoing demand.”
The report also revealed that home-price growth was well above the national growth rate (15% year-over-year) for all 10 of the most popular destinations in Dec. 2021. A prime example would be Phoenix, where a typical home sold for $435,000 in Dec., 28% more than the previous year. Meanwhile, average monthly rental payments increased 26% year-over-year to $2,100.
“Sellers are listing their homes at higher prices than ever before, partly because of huge demand in the last year from out-of-towners,” said Austin Redfin agent Barb Cooper. “I recently had a couple looking for a 2,000-square-foot home anywhere in the Austin area for under $300,000. I had to tell them it doesn’t exist.”
