The number of Redfin.com users looking to relocate to a different part of the country dropped 6% from last year, the biggest decline on record, the digital real estate brokerage said.
The drop is a significant turnaround from last year when the number of homebuyers looking to relocate rose 23%, and reflects the overall state of the U.S. housing market, which is dealing with high mortgage rates and economic uncertainty, Redfin said.
Out-of-town moves, however, held up well compared with in-town moves. The number of Redfin users looking to relocate within their current metro area is down 17%, about three times the drop for relocators. That’s also the biggest drop in Redfin’s records, which go back through 2018.
The results indicate that while the overall home-buying pie is smaller than it was a year ago, Americans moving to a new metro make up a bigger piece than ever before. A record one-quarter (25.2%) of Redfin users nationwide are looking to relocate, up from 22.8% a year earlier and roughly 19% just before the pandemic started.
Out-of-town moves among homebuyers have declined from a year ago because fewer people are moving. Overall home sales dropped 22% from a year earlier in April as elevated mortgage rates and the ongoing lack of inventory deterred buyers.
Redfin noted that out-of-town moves fell substantially less than within-metro moves for a few reasons:
- Many buyers leaving their hometowns are moving to more affordable areas (Los Angeles to Las Vegas, or New York to Tampa, for example). High mortgage rates aren’t as big a deterrent for someone selling an expensive home and buying a cheaper one. Remote work also makes moving feasible for a lot of people.
- For first-time buyers, high mortgage rates may encourage relocation to a different metro area. The ongoing affordability crunch, with high rates and still-high home prices, makes relatively affordable locales more attractive.
- People moving to an entirely different area often do so out of need, such as for a new job or to take care of a family member. That’s compared with would-be buyers looking in their current metro, who may be more apt to delay home-buying plans because they’re simply looking for more space or a different layout, Redfin said.
Sun Belt Most Popular
Phoenix and Miami are the most popular destinations for Redfin.com users looking for homes in a different part of the country, followed by Las Vegas; Tampa, Fla., and Orlando, Fla. Five of the top 10 destinations are in Florida, and nearly all are in the Sun Belt. Popularity is determined by net inflow, a measure of how many more Redfin.com users looked to move into an area than leave.
Relatively affordable, warm-weather metro areas with low taxes are typically popular for home-buyers relocating to a different part of the country. They’re especially sought-after destinations for people leaving expensive coastal job centers: For example, Seattle (median sale price: $770,000) is the most common origin for homebuyers moving to Phoenix ($439,000), while Los Angeles ($830,000) is the most common origin for those moving to Las Vegas ($400,000).
Florida soared in popularity as the pandemic-driven remote-work trend took hold, with many Americans moving there for the relatively affordable housing and sunshine. That’s in spite of worsening natural disasters. The Sunshine State is still a magnet for relocating home-buyers, many of whom come from colder northern metros. New York is the most common origin for homebuyers moving to Miami, Tampa, and Orlando, and Chicago is the most common for those moving to North-Port Sarasota and Cape Coral.
Still, the number of Redfin.com users moving to Florida has declined over the last year, as fewer people buy homes overall. The net inflow of homebuyers into Miami, for example, was nearly 13,000 a year ago; now it’s 7,500. The net inflow into Tampa was about 9,000 a year ago, compared to 6,000 now.
“About half of the people buying homes here are from out of town, and some are able to pay cash,” said Nicole Dege, an Orlando Redfin Premier agent. “That’s making it difficult for some locals to get their offers accepted, especially because many people have limited budgets due to high mortgage rates and there are so few homes coming on the market. Even though fewer people are coming in from out of town, there are also fewer homes for sale.”
Leaving California & New York
More homebuyers are looking to move away from San Francisco, New York, Los Angeles, Washington, D.C., and Boston than any other metros in the country. The list of places home-buyers are leaving is determined by net outflow, a measure of how many more Redfin.com users are looking to leave a metro than move in.
Expensive coastal places, especially tech hubs like the Bay Area and Seattle, typically top the list of places home-buyers are leaving. Homes in those areas are pricey, and people — especially remote workers — often leave in favor of places where housing and the overall cost of living are cheaper.
