Buyers are moving to smaller cities and more affordable states: renters are buying or moving out of the city. The demographic changes will impact more than real estate.
WASHINGTON – Call it “the great reshuffling” – one in 10 Americans moved during the year of the pandemic, and with the health situation (hopefully) stabilizing through the widespread accessibility of vaccines, more may be on the way.
“Millions of additional households could enter the real estate market as a result of the pandemic,” predicted the real estate firm Zillow, which has been tracking changes in buyer preferences since the onset of the COVID crisis in March 2020.
The firm pegs the possible COVID-driven moves as upward of a possible 2.5 million, and those attempting to find the right home might find a less-constrained inventory than has been the case over the past year.
“Life and financial uncertainty are among the top reasons homeowners have not listed their home for sale during the pandemic,” analysts said. “The COVID-19 vaccine is likely to change that and prompt many more people to move.”
Zillow data finds a large majority of homeowners (70%) say they would be mostly or completely comfortable moving to a new home when there is widespread vaccine distribution.
Among those who have relocated over the past year, three-quarters (75%) say they moved for positive reasons, such as being closer to family or friends or living in an area they’ve always dreamed of. New flexibility to telework has opened up those opportunities for many, and new real estate technology has enabled prospective purchasers to get an immersive experience of a home from hundreds or thousands of miles away.
Phoenix, Charlotte and Austin saw the highest net inbound moves in the first 11 months of 2020, sought out by those eager for relative affordability and warmer weather. Those Sun Belt metros are expected to continue to surge in 2021.
Data from North American Van Lines also finds some of the country’s largest and most expensive housing markets saw the highest net outbound moves, including New York, Los Angeles, San Francisco and Chicago. Zillow saw for-sale inventory in these metros climb in the city, while inventory nationally hit new lows.
“The pandemic brought an acceleration of trends we were seeing in 2018 and 2019,” said Zillow senior economist Jeff Tucker. “More affordable, medium-sized metro areas across the Sun Belt saw significantly more people coming than going, especially from more expensive, larger cities farther north and on the coasts. The pandemic has catalyzed purchases by millennial first-time buyers, many of whom can now work from anywhere.”
Zillow’s survey found that nearly a third of recent movers (31%) say they had been dreaming about moving for a year or longer. More than three-quarters of recent movers (76%) say emotional factors had been holding them back from making their most recent move. Stress over not being financially prepared to make the move and the expectation that the moving process would be hard or stressful were the most commonly cited factors.
Nearly a quarter (23%) of recent movers say the concern that their move would cause stress for their child(ren) held them back from making their most recent move.
After their most recent move, more than half of Americans said they experienced happiness (54%) and relief (53%). A vast majority of recent movers (80%) say their most recent move was worth it.
Many recent movers say starting a new chapter in their life was among the most rewarding parts of moving to a new home. Nearly three in five (59%) say positive life events happened after their most recent move, most commonly citing that they fulfilled a dream or became passionate about something new.
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