Housing market: The top U.S. cities home buyers want to leave

The COVID-19 pandemic shook up the U.S. housing market and the nation’s migration patterns as remote work gave Americans new levels of freedom to choose where they wanted to live.

Now, that pattern continues — with the share of homebuyers who are looking to relocate reaching a new record high this summer. Only now, it’s higher mortgage rates and still sky-high home prices that are motivating homebuyers, especially those from expensive cities, to look at more affordable areas.

That’s according to an Aug. 11 Redfin analysis, which found the share of homebuyers looking to relocate out of their areas jumped to a new record high in July.

How many people want to move away? A record 33.7% of Redfin.com users nationwide looked to move from one major metro area to another in July, up from 32.6% in the second quarter of this year and up about 26% since before the pandemic, according to the report.

Here are the top 10 cities homebuyers looked to leave in July, the net outflow of users Redfin tracked that month and the portion of local users searching elsewhere. Net outflow is how many more Redfin.com users looked to leave a metro than move in.

1. San Francisco, California: 29,051 outflow of users, 24.1%.
2. Los Angeles, California: 25,017 outflow, 20.1%.
3. New York, New York: 19,782 outflow, 28.6%.
4. Washington, D.C.: 14,742 outflow, 17.8%.
5. Boston, Massachusetts: 8,742 outflow, 19.9%.
6. Seattle, Washington: 5,222 outflow, 17.5%.
7. Detroit, Michigan: 3,704 outflow, 34.1%.
8. Minneapolis, Minnesota: 3,334 outflow, 34.2%.
9. Chicago, Illinois: 3,284 outflow, 16%.
10. Denver, Colorado: 2,584 outflow, 30.2%.

Large shares of homebuyers are leaving expensive coastal job centers for more affordable areas — however migration out of the Bay Area is slowing as the California housing market cools faster than other regional markets across the country.

In July, more homebuyers left the Bay Area, Los Angeles and New York than any other metro, unchanged from the first half of the year, according to Redfin. Washington, D.C., and Boston round out the top five, while Seattle, Detroit, Minneapolis, Chicago and one city in the West — Denver, Colorado — round out the top 10.

“It’s typical that homebuyers look to move out of expensive job centers, and the trend has generally intensified during the pandemic as white-collar employees in those places switch to remote work,” Redfin wrote in its August report.

Where are they going? Sunny and (more) affordable. That’s what seems to be top of mind for homebuyers looking to relocate out of their metro areas.

Miami was the most popular migration destination in July (matching a pattern that’s persisted through the first half of 2022), according to Redfin. However, migration to the south Florida metro is starting to slow, with fewer homebuyers looking to move there compared to a year earlier.

That’s the same for some other “perennially popular destinations,” like Sacramento, which was the second-most popular destination in July, but with less migration compared to a year earlier.

San Diego, however, is gaining traction. It’s the third most popular destination, according to Redfin, jumping up from No. 7 in the second quarter. Migration into San Diego has more than doubled from a year ago, with Los Angeles as the most common origin of homebuyers. moving there.

Even though San Diego home prices are on par with Los Angeles and Seattle, homebuyers relocating there are seeking out a slower pace of life, Redfin states.

“We’ve always had a lot of people from the Bay Area and Los Angeles move to San Diego for a better work-life balance and a beachside lifestyle, and it has picked up since remote work became commonplace,” said San Diego Redfin agent Jodie Lee.

“This year, I’ve also seen quite a few remote workers move in from places like Seattle and North Carolina because they like the sunny weather and outdoor activities in this area. San Diego also has a big military presence, and more service members are relocating here now that the cooling market means they have a better chance of getting an offer with a VA loan accepted.”

Here are the top 10 metros ranked by net inflow of Redfin users in July, and their portion of searches from users outside the metro in July of 2022.

1. Miami, Florida: 6,704 net inflow of users, 34.3%.
2. Sacramento, California: 6,550 inflow, 44.5%.
3. San Diego, California: 5,689 inflow, 33.7%.
4. Tampa, Florida: 5,431 inflow, 49.6%.
5. Las Vegas, Nevada: 5,418 inflow, 48.2%.
6. Phoenix, Arizona: 4,853 inflow, 36.9%.
7. North Port, Florida: 3,446 inflow, 68.7%.
8. Cape Coral, Florida: 3,401 inflow, 69.4%.
9. Portland, Maine: 2,582 inflow, 64.2%.
10. San Antonio, Texas: 2,411 inflow, 39.5%.