Pandemic Accelerating Homebuyer Relocation to Less Dense Areas, Redfin Says

A record 27% of home searchers looked to move to another metro area in April and May 2020, according to a report from tech-based brokerage Redfin. This marks a new high in the share of users searching for homes outside their area, up from 25.2% in the second quarter of 2019 and 26.0% in the first quarter of this year.

New York, San Francisco and Los Angeles had the biggest net outflow of users in April and May. A net outflow means more people are looking to leave than move in, while a net inflow means more people are looking to move in than leave.

“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. ”

The latest migration analysis is based on a sample of more than 1 million 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 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.

The increase in users searching for out-of-town homes may be partly due to the coronavirus pandemic, the company said, as more people consider moving to suburbs and smaller towns with less crowding and more room to work from home. Overall, searches for homes in small towns are surging on the website: page views of homes in towns with fewer than 50,000 residents were up 87% year over year in May, more than triple the 22% year-over-year increase in page views of homes in cities with more than 1 million residents.

The places home searchers are looking to leave and those they’re looking to move into remain largely the same as before the pandemic took hold: users want to leave expensive coastal metros for affordable inland areas. Phoenix, Sacramento and Las Vegas, all relatively inexpensive metros, had the highest net inflow of users in April and May.

“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.”

Nashville has seen the biggest jump in the share of people looking to move in since last year. Thirty-five percent of home searches in Nashville during April and May were from users outside the metro, compared with 29.1% a year ago.

“More and more people are moving into Nashville from out of state, especially California, Chicago and the Northeast,” said local Redfin Agent Mike Estes. “A lot of the recent movement is driven by jobs. Now that more people are able to work from home due to COVID, some people are deciding to work virtually from Nashville because they love all the area has to offer. Amazon is now a major employer here, along with the music industry and various healthcare systems. And low taxes have always been a huge reason for out-of-state people to move into Nashville, as Tennessee has no income tax and low state property taxes.”