According to a new report from Redfin, the median sale price for homes in rural areas nationwide increased 11.3% year over year in the four weeks ending August 2, while the price rose 9.2% in suburban areas and 6.7% in urban areas.
Homes in rural areas have had higher price growth than suburban and urban areas since April, Redfin notes.
“We’ve been speculating about increasing interest in the suburbs and rural areas since the start of the pandemic,” says Redfin economist Taylor Marr. “Now we’re seeing concrete evidence that rural and suburban neighborhoods are more attractive to home buyers than the city, partly because working from home means commute times are no longer a major factor for some people. And due to historically low mortgage rates, interest is turning into action.”
The pandemic has caused 13% of home buyers to search for homes in a different area than originally planned, according to a survey of more than 1,000 people who plan to buy a home within the next 12 months conducted by Redfin from July 19-21. Redfin asked those 140 buyers two questions: 1) What best describes where you were searching for a home before the onset of the pandemic, and 2) What best describes where you’re now searching for a home?
Results indicate that interest in rural areas and suburbs is up, and interest in urban areas is down.
Most (59%) respondents indicated that they’re searching for a home in the same type of area as they were before the pandemic, with the most common combination of answers (30%) being suburban before and suburban now, though those respondents are likely searching in a different suburb or an entirely different metro area.
Of respondents who are now looking to move to a different type of area, the most common combination was that of people searching for a home in an urban area before and a suburban area now, with 19% selecting that pathway.
The outsized interest in rural areas and suburbs is likely due to the coronavirus-driven desire for more indoor and outdoor space and the prevalence of working remotely. The pandemic has caused 21% of homebuyers to want a designated place to work from home and the same share to want more outdoor space, according to the aforementioned survey.
To read the full report, click here.