Redfin Reports A Record Share of Homebuyers Relocate, Driven By Moves Away From Expensive Coastal Areas

Rhea-AI Summary

A record 33.9% of Redfin.com users sought to relocate between metro areas in July and August, up from 32.6% in Q2, as high mortgage rates and inflation drive homebuyers from expensive markets to more affordable regions. Home sales are down 20% year-over-year, with remote workers significantly influencing migration patterns. Major cities like San Francisco, Los Angeles, and New York experienced substantial outflows, while Miami remains the most popular destination. The average home price in Las Vegas was $416,000, notably lower than that in Los Angeles at $845,000.

Positive

• Record 33.9% of Redfin.com users sought relocation, indicating a strong trend among homebuyers.
• Homebuyers increasingly favor affordable areas, making them attractive amidst high prices elsewhere.
• Miami continues to be the top destination for relocating homebuyers, reflecting demand in warmer climates.

Negative

• Home sales have declined by 20% year-over-year, signaling a significant slowdown in the housing market.
• High mortgage rates exceeding 6% are discouraging potential buyers and exacerbating affordability challenges.
• Many previously popular coastal areas show increased net outflows, indicating declining interest and potential market risks.

High mortgage rates, persistent inflation and economic woes are making expensive parts of the country less attractive and relatively affordable places more popular

SEATTLE--(BUSINESS WIRE)-- (NASDAQ: RDFN) — A record 33.9% of Redfin.com users nationwide looked to move from one metro to another in July and August, according to a new report from Redfin (www.redfin.com), the technology-powered real estate brokerage. That’s up from 32.6% in the second quarter and about 26% before the pandemic.

The U.S. housing market has slowed considerably from the height of the pandemic homebuying frenzy, and home sales are down 20% from a year ago. But the share of relocating buyers out of all buyers is at its highest level since at least 2017, when Redfin started tracking migration data.

“The overall slowdown and the popularity of relocating are both due to high home prices and mortgage rates that have doubled since last year,” said Redfin Deputy Chief Economist Taylor Marr. “Six percent mortgage rates are exacerbating already-high home prices and motivating homebuyers–especially remote workers–to leave expensive areas for more affordable ones. Persistent inflation and slumping stocks are also cutting into buyers’ budgets, making relatively affordable areas even more attractive.”

Homebuyers are leaving expensive coastal areas at higher rates than a year ago

More homebuyers left the Bay Area than any other metro in July and August. That’s determined by net outflow, a measure of how many more Redfin.com users looked to leave a metro than move in. Next come Los Angeles, New York, Washington, D.C. and Boston, all expensive job centers highly populated by remote workers with the flexibility to relocate.

Migration out of four of those five places–Los Angeles, New York, Washington, D.C. and Boston–increased from a year earlier. That’s partly because of high mortgage rates and economic woes, including inflation, making it more difficult to afford homes in those places.

The number of homebuyers looking to move out of the Bay Area declined, likely because it’s one of the only parts of the U.S. where home prices are dropping year over year, giving buyers in the perennially expensive area a bit of relief. Prices fell 8% year over year in San Francisco, 1.6% in Oakland and 0.2% in San Jose.

Top 10 Metros by Net Outflow of Users and Their Top Destinations
Rank	Metro*	Net Outflow, July and August 2022†	Net Outflow, July and August 2021	Portion of Local Users Searching Elsewhere, July and August 2022	Portion of Local Users Searching Elsewhere, July and August 2021	Top Destination	Top Out-of-State Destination
1	San Francisco, CA	40,432	52,854	24.1%	25.2%	Sacramento, CA	Seattle, WA
2	Los Angeles, CA	34,832	30,754	20.0%	18.1%	San Diego, CA	Las Vegas, NV
3	New York, NY	26,786	25,725	28.7%	27.3%	Philadelphia, PA	Philadelphia, PA
4	Washington, DC	20,542	16,405	17.7%	15.1%	Salisbury, MD	Salisbury, MD
5	Boston, MA	11,543	9,253	19.8%	16.8%	Portland, ME	Portland, ME
6	Chicago, IL	6,883	5,504	16.6%	12.3%	Los Angeles, CA	Los Angeles, CA
7	Detroit, MI	5,330	3,300	34.4%	28.2%	Cleveland, OH	Cleveland, OH
8	Seattle, WA	4,143	3,766	17.1%	14.5%	Los Angeles, CA	Los Angeles, CA
9	Minneapolis, MN	3,740	1,777	31.0%	21.8%	Chicago, IL	Chicago, IL
10	Denver, CO	3,739	4,662	24%	20.1%	Chicago, IL	Chicago, IL
*Combined statistical areas with at least 500 users in July and August 2022 †Among the two million users sampled for this analysis only

Warm Sun Belt metros are most popular for relocating homebuyers

Miami was the most popular migration destination, continuing a year-plus streak of the South Florida metro taking the number-one spot. Popularity is measured by net inflow, or how many more Redfin.com users looked to move into an area than leave.

Next come two California metros: Sacramento, perennially popular for homebuyers moving from one metro to another, and San Diego, which only recently jumped onto the list of most popular destinations. Las Vegas and Tampa, FL round out the top five. They’re followed by Phoenix, Cape Coral, FL, North Port, FL, Portland, ME and San Antonio, TX.

Nine of the 10 most popular destinations are warm-weather metros located in the Sun Belt (Portland is the exception). Eight of the 10 have median sale prices below $500,000; Sacramento ($570,000) and San Diego ($800,000) are the exceptions. And six of them are located in places with no state income tax, which lowers the overall cost of living. Although home prices in many of the popular destinations have increased significantly throughout the pandemic, they’re still more affordable than the places homebuyers are coming from. The typical home in Las Vegas, for instance, sold for $416,000 in August, half of the $845,000 median in Los Angeles, the number-one origin for people moving in.

Top 10 Metros by Net Inflow of Users and Their Top Origins
Rank	Metro*	Net Inflow, July and August 2022†	Net Inflow, July and August 2021	Portion of Searches from Users Outside the Metro, July and August 2022	Portion of Searches from Users Outside the Metro, July and August 2021	Top Origin	Top Out-of-State Origin
1	Miami, FL	8,845	10,435	33.2%	33.1%	New York, NY	New York, NY
2	Sacramento, CA	8,504	8,327	43.9%	42.1%	San Francisco, CA	Reno, NV
3	San Diego, CA	7,811	3,598	33.6%	28.4%	Los Angeles, CA	Seattle, WA
4	Las Vegas, NV	7,323	6,739	47.2%	41.8%	Los Angeles, CA	Los Angeles, CA
5	Tampa, FL	7,145	6,240	48.1%	46.9%	Orlando, FL	New York, NY
6	Phoenix, AZ	6,447	8,411	36.0%	35.4%	Los Angeles, CA	Los Angeles, CA
7	Cape Coral, FL	4,951	4,234	68.5%	69.4%	Chicago, IL	Chicago, IL
8	North Port, FL	4,700	3,983	67.3%	67.8%	Chicago, IL	Chicago, IL
9	Portland, ME	3,876	3,692	64.9%	65.2%	Boston, MA	Boston, MA
10	San Antonio, TX	3,235	4,396	38.9%	42.0%	Austin, TX	Los Angeles, CA
*Combined statistical areas with at least 500 users in July and August 2022 †Negative values indicate a net outflow; among the two million users sampled for this analysis only

To read the full report, including charts and methodology, please visit: https://www.redfin.com/news/august-2022-housing-migration-trends

About Redfin

Redfin (www.redfin.com) is a technology-powered real estate company. We help people find a place to live with brokerage, instant home-buying (iBuying), rentals, lending, title insurance, and renovations services. 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. Our rentals business empowers millions nationwide to find apartments and houses for rent. Since launching in 2006, we've saved customers more than $1 billion in commissions. We serve more than 100 markets across the U.S. and Canada and employ over 6,000 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.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220920005465/en/

Redfin Journalist Services:

Erin Osgood, 206-588-6863

press@redfin.com

Source: Redfin

FAQ

What percentage of users on Redfin.com sought to relocate in July and August 2022?

In July and August 2022, 33.9% of Redfin.com users looked to relocate between metro areas.

Which cities saw the highest net outflow of users in July and August 2022?

San Francisco, Los Angeles, and New York had the highest net outflows of users in July and August 2022.

What factors are driving homebuyers to relocate according to the August 2022 report?

High mortgage rates, persistent inflation, and high home prices are motivating homebuyers to relocate to more affordable areas.

What is the most popular migration destination for homebuyers in 2022?

Miami, FL, is the most popular migration destination for homebuyers as of July and August 2022.

How much did home sales decline year-over-year according to the latest report?

Home sales have declined by 20% year-over-year, reflecting a slowdown in the housing market.