Since when are Sacramento and Miami affordable places for homebuyers? According to a new Redfin report based on net inflow calculations, these are some of the top areas homebuyers are moving to save money.
Sacramento is the most popular relocation destination for Redfin users. Miami, Las Vegas, San Diego and Tampa round out the top five.
Nearly one in four homebuyers (24.2%) in the U.S. were looking to move to a new metropolitan area in the third quarter. That’s up 23.3% from Q2 and up 21.6% since 2021. Before the pandemic about 18% of homebuyers were looking to move metros.
Chen Zhao, economics research lead at Redfin, says a looming recession is behind some of the migration.
“Migration will likely slow in the coming months because the softening labor market and job losses will push more people to stay put or move in with family, though some may need to relocate for new employment opportunities. Plus, many remote workers who wanted to relocate already have,” Zhao added in a statement.
High mortgage rates, inflation and high home prices are impacting affordability for homebuyers. Redfin’s net outflow calculation shows that homebuyers looking to move are doing so from expensive coastal job centers, including San Francisco, Los Angeles, New York, Washington, D.C., Boston, Chicago, Detroit, Denver, Seattle and Minneapolis.
On the other hand, popular inflow cities include Sacramento, Miami, Las Vegas, San Diego, Tampa, Phoenix, Cape Coral, North Port-Sarasota, Dallas and Portland, Maine.
Areas that are both warm and affordable top the chart for out-of-town homebuyers. Sacramento has a median home sale price of $560,000, higher than the national average but much lower than San Francisco’s median price of $1.5 million.
Redfin agent Samantha Rahman attributes the relocation to Sacramento to the migration of remote workers from the Bay Area who want to save money by lowering their housing costs and only need to visit their offices sporadically.
“It makes even more sense to relocate to a more affordable region now than it did when mortgage rates were low, as lower-priced homes offset some of the expense of high rates and rack up less interest,” Rahman added.
New Yorkers are moving to Miami for a similar reason, where the median sale price is $475,000 as opposed to New York’s $680,000. Some of those leaving Boston are migrating to Portland, Maine, where homes on average cost $200,000 less than in Boston, the report says.