The cross-market migration boom is officially slowing as fewer Redfin.com users search for homes outside their current metros.
A new report from Redfin shows a decline in the pandemic-fueled migration for November as the share of homebuyers relocating drops for the third straight month to 23.9%, its lowest level in 18 months—down from 24.1% a year ago and from a record high of 26% over the summer.
For buyers who are still relocating, the most popular destinations are still relatively affordable metros like Sacramento, Las Vegas, and Orlando. And for the first time on record, Spokane, WA, reached the top ten list as more buyers in Seattle, Los Angeles, and Portland, OR, moved there to take advantage of its lower home prices.
Also in November, Los Angeles became the number one metro buyers are moving out of, displacing the Bay Area, which has taken the top spot for more than two years.
Data for Redfin’s report is based on home searches of roughly two million Redfin.com users viewing for-sale homes across more than 100 metro areas from September to November 2023.
Read on for the highlights.
BEHIND THE DROP IN HOMEBUYER MIGRATION
Homebuying slowed in 2023 thanks to record-low housing affordability with the one-two punch of high mortgage rates and record-low inventory driving up home prices.
Compared to a year ago, 4% fewer Redfin.com users searching for homes in November were looking to move to a different metro, compared to a 3% year-over-year decline in Redfin.com users viewing for-sale homes within their current metro.
That slightly bigger drop (4% vs 3%) explains why migrating homebuyers account for a smaller share of total Redfin.com home searches.
That said, as mortgage rates continue to decline, as housing economists expect, that share may increase in the new year.
For now, we can chalk up that lower share to two key factors:
- Buyers today have comparatively less flexibility to work remotely as employers (in some industries more than others) call workers back to the office.
- Generally speaking, home prices have increased more in top migration destinations compared to pricey coastal metros, making a dent in potential savings for migration-minded homebuyers
Sacramento, for example, has seen a jump in home prices of about 35% since before the pandemic, compared to an 8% increase in Bay Area home prices.
But even with that, all 10 of the most popular migration destinations—including Sacramento—still have home prices well below those of their most common origin metros. And the share of migrating buyers is still higher than the 19% share from before the pandemic.
TOP 10 METROS HOMEBUYERS ARE MOVING INTO (BY NET INFLOW)
For the first time in Redfin’s records (which go back through 2017), Spokane, WA, made the top ten list of popular destinations for migrating homebuyers.
Landing at #10, Spokane is the second-most populous city in the state of Washington. And compared to the typical Seattle home price of $775,000, Spokane offers a significant discount at $416,000.
