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REDFIN CORPORATION

(RDFN)
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Redfin : Reports More Than 31% of Homebuyers Are Looking to Move to Another Metro

06/17/2021 | 08:31am EDT

SEATTLE, June 17, 2021 /PRNewswire/ -- (NASDAQ: RDFN) — Nationwide, 31.4% of Redfin.com users looked to move to a different metro area in April and May, according to a new report from Redfin (redfin.com), the technology-powered real estate brokerage. This is roughly the same share Redfin saw in the first quarter and up from 27% from a year earlier.

Although the overall housing market is starting to stabilize after a red-hot start to the year, homebuyer interest in relocating remains elevated above pre-pandemic levels, and Redfin agents in popular destinations say they're still seeing an influx of out-of-towners.

The latest migration analysis is based on a sample of more than two million Redfin.com users who searched for homes across 87 metro areas in April and May, excluding searches unlikely to precede an actual relocation or home purchase. To be included in this dataset, a Redfin.com user must have viewed at least 10 homes in a particular metro area, and homes in that area must make up at least 80% of the user's searches.

Home prices are rising rapidly in the most popular destinations

Relatively affordable areas tend to be the most popular destinations for Redfin.com users looking to relocate, with Phoenix, Las Vegas, Sacramento, Austin and Miami topping the list. But as home prices continue to rise at a rapid rate, some of the most popular destinations in the U.S. are quickly becoming less affordable for migrants and locals alike.

In three out of those five metros, the median home-sale price is growing faster than it is nationwide. And with the exception of Las Vegas, prices are higher than the $377,000 national median.

Phoenix, Austin and Sacramento are also among the five metros with the biggest home-price increases in May. Home prices in Austin were up 42.4% year over year in May to $470,000, the biggest increase of the 88 largest U.S. metros. Phoenix, with a 33.3% gain to $400,000, had the second-biggest annual price increase in the U.S., and Sacramento had the fifth-biggest increase.

"People moving into Phoenix from California, Oregon, Washington and even the Midwest are flooding the market, depleting inventory and pushing up prices," said Phoenix Redfin agent Vincent Shook. "So many people can work remotely from anywhere in the country, so they started looking at Arizona versus a place like Los Angeles or Seattle and thinking, 'why stay in such a high-priced market when I can get a larger home in Phoenix for a lower price?' Largely because of those buyers moving in with higher salaries and the ability to easily offer over list price, nearly every home is selling for more than its asking price."

Prices in Las Vegas (+18.4% to $355,000) and Miami (+24.3% to $409,000) were also up significantly year over year. (Note that year-over-year increases may be exaggerated because the coronavirus pandemic slowed homebuying and selling activity in May 2020.)

Homes in the most popular destinations are still significantly more affordable than the places people are leaving

Still, people moving into places like Austin and Phoenix from expensive coastal areas are paying a much lower price for homes in their new location. A homebuyer could purchase three homes in Austin for the price of one home in San Francisco, or two homes in Phoenix for the price of one in Los Angeles.

In San Francisco, the most common origin for people moving to Austin, the typical home sold for $1.54 million in May, up 2.8% from last year. Though prices are growing comparatively slowly in San Francisco, the price difference is still staggering: The typical home in San Francisco sold for $1,070,000 more than the typical home in Austin in May.

In Los Angeles, the top origin for people relocating to Phoenix and Las Vegas, prices are rising so much that the home-price gap is widening. The typical home in Los Angeles sold for $815,000 in May (up 28.3% year over year), $415,000 more than the typical home in Phoenix. That's up from a $345,000 gap a year earlier.

"Even though homes in popular destinations are much more expensive than they were a year ago, it's still well worth it for many people to leave expensive coastal cities in favor of inland metros," said Redfin Chief Economist Daryl Fairweather. "That's especially true if they're working remotely and keeping the same salary. The story is different for locals, many of whom are being priced out of their hometowns."

Top 10 Metros by Net Inflow of Redfin.com Users and Their Top Origins

Rank

Metro*

Net
Inflow,
May
2021

Net
Inflow,
May
2020

Portion of
Searches from
Users Outside the
Metro, May 2021

Portion of
Searches from
Users Outside the
Metro, May 2020

Top Origin

Top Out-of-
State Origin

 

Median sale price
(Destination; May
2021)

Median sale price,
YoY (Destination;
May 2021)

1

Phoenix, AZ

9,490

7,736

38.5%

35.2%

Los
Angeles,
CA

Los
Angeles, CA

$400,000

33.3%

2

Las Vegas,
NV

8,984

5,850

53.4%

46.5%

Los
Angeles,
CA

Los
Angeles, CA

$355,000

18.4%

3

Sacramento,
CA

7,928

6,677

48.8%

45.5%

San
Francisco,
CA

Reno, NV

$550,000

29.3%

4

Austin, TX

7,604

5,385

39.1%

34.8%

San
Francisco,
CA

San
Francisco,
CA

$470,000

42.4%

5

Miami, FL

7,305

3,381

32%

27.3%

New York,
NY

New York,
NY

$409,000

24.3%

6

Dallas, TX

7,239

4,327

32.1%

27.3%

Los
Angeles,
CA

Los
Angeles, CA

$376,000

25.4%

7

Atlanta, GA

7,207

5,443

26.9%

26.4%

New York,
NY

New York,
NY

$325,000

24.5%

8

Tampa, FL

6,442

3,887

59.8%

57.7%

Orlando,
FL

New York,
NY

$300,000

20%

9

Orlando, FL

5,470

2,205

58.6%

52.6%

New York,
NY

New York,
NY

$315,000

14.1%

10

Cape Coral,
FL

5,439

2,114

77.3%

74.9%

Chicago, IL

Chicago, IL

 

$320,000

31.1%

*Combined statistical areas with at least 500 users in April and May 2021

†Negative values indicate a net outflow; among the two million users sampled for this analysis only

Expensive coastal cities are losing residents

New York, San Francisco, Los Angeles, Washington, D.C. and Denver are the places Redfin.com users most commonly looked to leave in May.

Big, expensive cities tend to top the list of places people are leaving, and they typically move to more affordable areas. For instance, Sacramento is the top destination for people leaving San Francisco, and Phoenix is the top destination for people leaving Seattle.

Top 10 Metros by Net Outflow of Redfin.com Users and Their Top Destinations

Rank

Metro*

Net
Outflow,
May 2021

Net
Outflow,
May 2020

Portion of Local
Users Searching
Elsewhere, May
2021

Portion of Local
Users Searching
Elsewhere, May
2020

Top Destination

Top Out-of-State Destination

 

Median sale price (Origin; May 2021)

Median sale
price YoY
(Origin; May
2021)

1

New York, NY

45,874

25,937

36.5%

35.7%

Boston, MA

Boston, MA

$640,000

12.3%

2

San Francisco, CA

32,188

25,038

23%

22.3%

Sacramento, CA

Seattle, WA

$1,540,000

2.8%

3

Los Angeles,
CA

25,845

13,276

19%

15.8%

San Diego, CA

Las Vegas, NV

$815,000

28.3%

4

Washington, DC

14,932

8,094

15%

12.3%

Salisbury, MD

Salisbury, MD

$512,500

16.5%

5

Denver, CO

8,587

3,799

31.8%

24.3%

Seattle, WA

Seattle, WA

$532,000

22.3%

6

Chicago, IL

5,827

6,124

13.3%

11.5%

Cape Coral, FL

Cape Coral, FL

$316,000

19.2%

7

Seattle, WA

5,804

4,080

15.5%

13.2%

Phoenix, AZ

Phoenix, AZ

$738,000

26.1%

8

Milwaukee, WI

3,763

1,039

46.9%

36.3%

Chicago, IL

Chicago, IL

$270,000

12.5%

9

Boston, MA

3,268

2,815

14.9%

11.8%

Portland, ME

Portland, ME

$625,000

17.9%

10

Detroit, MI

2,289

736

26.9%

23%

Cleveland, OH

Cleveland, OH

 

$179,000

32.3%

*Combined statistical areas with at least 500 users in April and May 2021

†Among the two million users sampled for this analysis only

To view the full report, including charts and methodology, please visit: https://www.redfin.com/news/april-may-2021-housing-migration-trends

About Redfin
Redfin (www.redfin.com) is a technology-powered real estate broker, instant home-buyer (iBuyer), lender, title insurer, and renovations company. We sell homes for more money and charge half the fee. We also run the country's #1 real-estate brokerage site. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can take an instant cash offer from Redfin or have our renovations crew fix up their home to sell for top dollar. Since launching in 2006, we've saved customers more than $1 billion in commissions. We serve more than 95 markets across the U.S. and Canada and employ over 4,100 people.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.

Cision
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SOURCE Redfin


© PRNewswire 2021
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