Are buyers leaving urban areas because of the pandemic?
Due to the Covid pandemic, many consumers across the country have decided to re-evaluate their check list regarding their "dream home." Many families feel the location and layout of their home are no longer fit their needs and comfort. The attraction of city living (more crowded) appears to be losing out to suburban or rural living (less crowded). The allure of open and airy floor plans appears to be less attractive as consumers are realizing privacy and space for home offices are becoming a priority as more people are working remotely.
A recent report from news.com announced more and more homebuyers are deciding against city property listings in favor of suburban and rural properties. Below are the year-over-year increase in percentages in views per property type:
*Urban – 7%
*Suburban – 13%
*Rural – 16%
Javier Vivas, Director of Economic Research for realtor.com, offers these numbers some meaning:
“This migration to the suburbs is not a new trend, but it has become more pronounced. After several months of shelter-in-place orders, the desire to have more space and the potential for more people to work remotely are likely two of the factors contributing to the popularity of the burbs.”
Realtor Magazine also just revealed that the urge to move is heaviest in our city real estate markets:
“Nearly 30% of respondents living in a high-density urban area say that the pandemic is prompting them to want to move by the end of the year...This is more than double the rate of those living in rural parts of the country, where residents are much more likely to stay put rather than to relocate.”
New Construction Also Seeing a Surge in Views
In anticipation of this change in consumers view of ideal floorpans caused by the pandemic, home builders are waiting on how future homes will change. Zillow recently reported in a press release:
*Builders believe as people spend more time at home during the pandemic, buyers are realizing which features of their homes are working and not working.
*Homebuilders predict open-concept floor plans will be a thing of the past, as people now value more walls, doors, and overall privacy.
*New construction, which offers the chance to personalize home features, saw its listing page views grow by 73% over last May.
The Virus is Even Impacting the Luxury Second-Home Market
COVID-19 has also had an impact on the luxury real estate market as well. In an article released last week titled, Luxury Buyers Return to Market in Force, Danielle Hale, Chief Economist for realtor.com reported:
“Stay at home orders and social distancing have put a new value on the extra space. We're seeing this in the luxury market as well, which could mean there is renewed interest from high-end buyers to find a second-home that is within driving distance from their primary residence.
Much like the suburbs are gaining favor with home shoppers, second home markets are seeing increased interest from luxury buyers…Views of luxury properties accelerated 56% in The Hamptons, 28% in Palm Springs and 24% in Greenwich compared to January trends."
It looks like a large population are getting ready to move away from American cities. Several folks will make this move permanent, while others the move will be temporary (2nd home/vacation property). In either case, many consumers are actively making a change. Real estate agents are ready and willing to assist them.
The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. John Sabia, Coldwell Banker and Keeping Current Matters, Inc. does not guarantee or warrant the accuracy or completeness of the information or opinions contained herein. Nothing herein should be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision. John Sabia, Coldwell Banker and Keeping Current Matters, Inc. will not be liable for any loss or damage caused by your reliance on the information or opinions contained herein.