According to a recent study by online real estate brokerage Redfin.com, one in four U.S. homebuyers are searching for a home in a different metro area than where they currently reside. This is the highest percentage since 2017, when Redfin first started tracking migration data.

What is driving this trend? The study suggests that homebuyers are motivated by two main factors: affordability and climate. Many homebuyers are leaving expensive coastal cities like New York or Los Angeles and moving to cheaper and warmer places in the South and Southwest, such as Las Vegas or Phoenix.

The study analyzed 100 metro areas based on the number of property searches on Redfin’s website for the three months ending June 2023. It calculated the net inflow and outflow of searches, which measure the difference between the number of people looking to move into a city and the number of people looking to leave.

The top 10 cities with the highest net inflow of searches were:

• Las Vegas: 5,700
• Phoenix: 5,300
• Tampa, Florida: 5,000
• Orlando, Florida: 4,900
• Sacramento, California: 4,800
• North Port-Sarasota, Florida: 4,700
• Cape Coral, Florida: 4,100
• Dallas: 4,100
• Miami: 3,700
• Houston: 3,600

Most of these cities have lower home prices and warmer weather than the cities where most of the potential migrants are coming from. For example, most of the out-of-town buyers looking for homes in Las Vegas are from Los Angeles. The median price of a home in Las Vegas is $412,500 as of June, which is less than half of the $975,000 median price in Los Angeles.

The top 10 cities with the highest net outflow of searches were:

• San Francisco: 28,100
• New York City: 24,200
• Los Angeles: 20,900
• Washington, D.C.: 15,700
• Chicago: 4,900
• Boston: 4,400
• Seattle: 3,900
• Hartford, Connecticut: 3,500
• Denver: 2,300
• Detroit: 2,300

Most of these cities have higher home prices and colder weather than the cities where most of the potential migrants are going to. For example, most of the people looking to leave San Francisco are searching for homes in Sacramento or Miami.

The study also found that remote work and rising mortgage rates are contributing to the migration trend. With more flexibility to work from anywhere, many homebuyers are choosing to live in places that suit their lifestyle preferences and budget constraints. Moreover, with mortgage rates reaching 20-year high, many homebuyers are looking for ways to reduce their housing costs.

If you are realtor who is trying to attract more clients, be sure to look out for our next blog article to discover how you can position yourself to take advantage of the above migration trend.

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