Record High Percentage of Homebuyers Seeking to Relocate to New Metropolitan Areas

Mortgage News April 7, 2023

According to a recent report by Redfin, there was a 3.6% year-over-year decrease in the number of users searching for homes in a different metropolitan area in February.

Redfin’s records, dating back to 2018, indicate that there was a significant decline in the number of users searching for homes within their current metropolitan area, with a 14.4% drop. This decline was even greater than the 3.6% decrease in users looking to relocate to a new metro. Both of these declines mark the largest ones on record for Redfin.

Mortgage rates have increased significantly over the past year, leading to higher home-buying costs in almost all cases. However, for those who are relocating, the impact of elevated rates may not be as significant as they tend to move to more affordable areas.

If someone is relocating from Los Angeles to Las Vegas, they can purchase a similar home for half the price of their current one. In this case, the impact of high mortgage rates may not be as significant as the homebuyer is getting a cheaper property and may be using the proceeds from the sale of their more expensive home. Moreover, those who move from one region to another may do so for a higher-paying job, which could offset the effects of high mortgage rates.

Furthermore, those who are relocating to another region may have a compelling reason for doing so, such as being closer to family or pursuing a higher-paying job. In such cases, the impact of high mortgage rates may not be a significant deterrent for homebuyers, as compared to those who are only considering a different home within the same town.

In February, Miami, Phoenix, Las Vegas, Sacramento (California), and Tampa (Florida) were the most sought-after destinations for those searching for a new metropolitan area to relocate to. The top 10 list is rounded out by other regions in Florida and a few metropolitan areas in Texas, including Orlando, Cape Coral, Dallas, North Port-Sarasota, and Houston. The popularity of these areas is based on the net inflow of users, which measures the number of users searching to move into an area versus those looking to leave it.

Sun Belt metropolitan areas, known for their affordable housing and warm climate, are consistently at the top of the list of popular relocation destinations.

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