The pandemic influenced daily life for millions of Americans, but it also had a huge impact on the housing markets, too. This year, people are on the move. A recent Aceable survey found 34% of Americans plan to move in 2021, up from 14% the year before.
One recent Zillow report highlights five cities — Austin, Phoenix, Tampa, Nashville, and Denver — as the most popular places for people to move this year and beyond. These cities are also expecting to see tremendous home appreciation rates. Meanwhile, Los Angeles, San Francisco, and New York are expected to be the coolest markets, having already experienced depreciation and population outflows.
With more people working at home and not needing to stress over commutes, they’re fleeing to larger homes in suburban areas, says Eric Jeanette, owner of Dream Home Financing. The financing pro sees people moving to the top five hot cities to leave higher cost-of-living cities like LA, San Francisco, and New York “for a better quality of life at a more reasonable cost.”
Here’s a look at what makes these five hot spots so attractive and why they may also be a great place to start or continue your real estate career.
With mild weather, a popular social and music scene, and a growing number of tech companies, Austin has been one of the most popular places to relocate for the past decade. The metro area grew by 29.8%between 2010 to 2019, with a population now of over 2,220,000 million. The city’s demographer estimates about 100 people a day moving to the area, and that’s a lot of people with real estate needs if you’re considering a career in Austin.
Median housing prices have increased from $193,520 in 2010 to $365,000 in late 2020, but with low interest rates and prices still affordable relative to New York and LA, experts say Austin is expected to continue its torrid growth pace for the near term.
More residents are willing to tolerate the city’s hot summers thanks to the trade-off of larger homes on larger lots, family-friendly communities, and the business-friendly environment the Phoenix metro area offers.
Phoenix was the fastest-growing city in the nation four years in a row, adding more than 26,000 residents in 2019 alone. Californians, in particular, are flocking to the Grand Canyon State, making a career in Arizona real estate a solid play here. Median housing prices for the metro valley hit $325,000 this year, and that figure is expected to rise.
“Prior to COVID our Phoenix-based real estate team probably took two or three calls a month from California buyers wanting to move to Arizona, but starting in April 2020 that number exploded to five or more a week," said John Gluch of The Gluch Group in Arizona. "That's a minimum of a 10x increase and it hasn't slowed down."
Tampa’s growth is more modest than some of the other hot cities, so you might chalk this city up as more of an up and coming one. But job growth is steady, attracting a number of professional services businesses, lower taxes, and abundant sunshine, all capped off with far more reasonable housing prices than the cool markets. These factors make Tampa a quality-of-life winner for many and a great place to practice real estate.
“People relocating from cities like San Francisco seem to be in disbelief about how much home they can buy in markets like Tampa," said Daniel Rascon, founder of Florida-based The Michael Group. "In San Francisco, where the median value for a single-family home and condo is $1.36 million, you can buy the same sized home on a generous lot in Tampa for $314,900,”
In the middle of 2020, Nashville was pegged as the 10th fastest-growing metro area in the country, adding more than 100,000 people between 2015 to 2018alone. But even with tremendous growth, the city keeps its small-town feel with a population still under 1 million people.
The median single-family home price topped $339,000 late last year. Affordability, access to world-class entertainment, and a relatively mild climate should keep this town singing a prosperous tune for the coming years, so a real estate career in Music City is a solid bet.
Transplants are attracted to the Mile High City’s mix of sports, entertainment, outdoor recreation, culture, and great communities for raising families. A vibrant, diverse economy helps as well, and the city grew its population by nearly 20% since 2010, although recent years have shown some slowing.
All of its positives come at a slightly higher price, too, as the median home price in Denver is around $465,000. That’s still well below what you’ll pay in San Francisco and Los Angeles, which should be enough to keep real estate agents busy in this bustling mountain city.
The Three Cold Markets
High taxes, high cost of living, and a lesser need to be close to work thanks to remote work are putting pressure on the New York City, San Francisco, and Los Angeles markets.
Not everyone is doom and gloom about their cities, however. Michael Shapot, a long-time New York real estate agent says: “I respectfully disagree with Zillow's report that New York is a cold market that will underperform. The recent contract signed statistics, as well as the new listing reports, all reflect extreme strength in Manhattan residential real estate. January was the best month in years, and December 2020 was the strongest December in years. This certainly bodes well for 2021.”
Regardless of your opinions, these reports indicate that people are on the move and a real estate career is a good option for years to come!