The American Dream has long been associated with owning a home. But that dream is evolving with the escalating mortgage rates hitting 20-year highs and real estate prices soaring in major cities. Today, we’re witnessing a significant shift in housing trends, moving away from coastal areas and into the heart of the South and Southwest. Here’s what’s happening.
The New Trend: Migrating to Affordability
For decades, cities like New York, Los Angeles, and San Francisco have been synonymous with opportunity and prosperity. However, the skyrocketing homeownership costs are now driving many away from these traditional hubs.
As a result, a substantial wave of migration is flowing into more affordable regions. Redfin’s data revealed an unprecedented trend in the three months leading up to June 2023. A staggering 26% of property search queries were for cities far from the searchers’ homes – the highest interest since Redfin started tracking these patterns in 2017.
Top Destinations: Las Vegas Leads the Way
Among the cities experiencing this influx, Las Vegas stands out with a net inflow of 5,700 searches. Phoenix, Tampa, and Orlando follow closely. These numbers reflect a significant shift in preference, undoubtedly influenced by lower home prices. A home that costs nearly a million dollars in Los Angeles is available for almost half the price in Las Vegas. The contrast is both alluring and telling.
The top 10 cities with the highest net inflow are:
- • 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
Leaving the Coastal Giants
As more and more people explore options away from the coastal giants, cities like San Francisco, New York City, Los Angeles, and Washington, D.C. are experiencing a net outflow in property searches. This shift isn’t merely a whim but a calculated decision. The search patterns indicate an inclination towards cities in low-tax states and those offering considerably cheaper home prices.
The Driving Factors: Economics and Lifestyle
While the economic factors are compelling, it’s not just about the money. This migration also hints at a broader lifestyle change. People are seeking a different quality of life, possibly driven by the experiences of the past few years. The pandemic, remote working trends, and new family dynamics might all be playing a role in this decision-making process.
Conclusion: A New American Dream?
The current migration pattern is more than a statistical anomaly. It’s a sign of a changing America, a country where the pursuit of happiness and the dream of homeownership are being redefined. The shift from coastal cities to more affordable regions in the South and Southwest is not merely a reaction to market forces. It’s a choice, a new direction in the way people are approaching life and livelihood.
In this complex real estate market, with ever-changing variables, one thing is clear: the American Dream is still alive, but it is on the move. The new destinations and choices reveal a nation adapting and evolving, ready to embrace the opportunities that lie ahead. Data provided by Redfin for the period ending June 2023.
