The number of Redfin.com home searchers looking to relocate to a new metro fell 3.6% year over year in February, according to a new report from Redfin. That compares with a 14.4% drop in Redfin.com home searchers looking to relocate within their current metro. Those are both the biggest declines in Redfin’s records, which go back through 2018.
The rise in mortgage rates over the last year has made purchasing a home more expensive almost across the board, but elevated rates often aren’t as big of a deterrent for relocating homebuyers because they’re typically moving to more affordable areas.
Additionally, homebuyers relocating to a different part of the country may have a non-negotiable reason for their move: Maybe they are moving for that higher paying job, or to be closer to family. High rates are less likely to deter those homebuyers than ones considering a different house within the same town.
25.1% of house hunters nationwide looked to relocate to a new metro in February. That’s up from 22.9% a year earlier and roughly 18% before the pandemic.
Relocators made up a bigger portion of homebuyers than ever because elevated mortgage rates, still-high home prices, inflation and economic uncertainty are motivating the few people who are still buying homes to move to more affordable areas. Remote work has also made it more feasible for Americans to relocate.
Miami, Phoenix, Las Vegas, Sacramento, Calif., and Tampa, Fla., were the most popular destinations for house hunters looking to move to a different metro in February. Other parts of Florida and a couple Texas metros round out the top 10: Orlando, Cape Coral, Dallas, North Port-Sarasota and Houston. 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 Sun Belt metros perennially top the list of places people are looking to move, due mainly to their comparatively cheap housing and warm weather.
While homes in these places cost considerably more than pre-pandemic, they remain comparatively affordable. The typical home in most of the popular destinations is less expensive than the typical home in the top origins. The typical Miami home sold for $485,000 in February, compared with $640,000 in New York, the most common origin for homebuyers looking to move in. The typical Phoenix home sold for $425,000, compared with $710,000 in Seattle, the most common origin.
“For buyers coming from the Bay Area or another expensive place, homes in Phoenix seem cheap. That’s why out-of-towners are still buying homes even though rates are high,” says Phoenix Redfin agent Heather Mahmood-Corley. “Desirable, well-priced homes are selling quickly, sometimes with a bidding war–largely because there are still so many buyers moving in from out of town.”
Homebuyers looked to leave San Francisco, New York and Los Angeles more than any other metro in February, followed by Washington, D.C., and Chicago. This ranking is determined by net outflow, a measure of how many more Redfin.com users looked to leave a metro than move in. View the full report here.
