A Record Share of Homebuyers Are Relocating: Key Trends for 2023

A record 25.4% of U.S. homebuyers are now searching for homes in a different metropolitan area, a significant increase from pre-pandemic levels. This trend is primarily driven by the pursuit of affordability as high mortgage rates and persistent home prices strain budgets. Despite a cooling overall housing market, relocation is proving more resilient than local moves, with buyers targeting Sun Belt hubs like Phoenix and Miami, even in the face of growing climate risks.

Why Are More Homebuyers Looking to Move to a Different Metro?

The primary catalyst for this surge in relocation interest is the combination of near-7% mortgage rates and sustained high home prices. For buyers from expensive coastal cities, moving to a more affordable region is a strategic financial decision. For example, the typical home in Seattle costs approximately $800,000, while in Phoenix, it is around $450,000. This price differential creates a powerful incentive to relocate.

The widespread adoption of remote work is another key factor. Since 2020, the ability to work from anywhere has given millions of Americans the geographical freedom to prioritize lifestyle and cost of living over proximity to a physical office. Furthermore, individuals relocating for major life events, such as a new job or family obligations, are often less likely to postpone their homebuying plans compared to those making a discretionary local move.

What Are the Most Popular Destinations for Relocating Buyers?

Based on an analysis of user search data from March to May 2023, the most popular destinations are defined by net inflow—the number of people looking to move into a metro minus those looking to leave.

These Sun Belt metros remain attractive despite intensifying environmental challenges. Arizona has even limited new home construction in parts of the Phoenix area due to water scarcity, which could impact future housing supply and prices.

Are Buyers Concerned About Climate Risks?

Currently, affordability appears to outweigh climate concerns for many relocating buyers. While natural disaster risks are a known factor—evidenced by some insurance companies pulling out of high-risk states like Florida and California—the immediate financial savings are a dominant motivator. Based on our experience assessment, the long-term impact of climate change on property values and insurability is a crucial consideration that buyers should weigh alongside upfront cost savings.

Where Are Buyers Leaving, and Where Are They Going?

The metros with the highest net outflow (more people looking to leave than move in) are San Francisco, New York, and Los Angeles. While these buyers often move to major Sun Belt cities, a notable trend involves smaller, scenic destinations.

• Buyers leaving Boston are most frequently moving to Portland, Maine.
• Buyers leaving Washington, D.C. are most commonly relocating to the Salisbury, Maryland area, which includes beach towns like Bethany Beach and Ocean City.

These smaller locales offer a combination of vacation-like ambiance and significant affordability. A home in the Salisbury metro has a typical price of $245,000, less than half the $560,000 median in Washington, D.C.

Key Takeaways for Homebuyers

• Relocation is a key strategy for affordability. If you have remote work flexibility, expanding your search to a different state can unlock substantial housing value.
• Conduct thorough due diligence on climate risks. Investigate insurance costs, flood zones, and water availability in your target area, as these factors can affect long-term affordability and safety.
• Consider emerging markets. Smaller vacation towns are gaining popularity and may offer a unique blend of lifestyle and value that larger cities cannot.

The overall housing market is slowing down, but the share of buyers willing to relocate to find affordable homes has reached a record high.