According to Redfin, in the third quarter of 2018, more people moved away from high-cost coastal markets like San Francisco and Los Angeles in increasing numbers.
Meanwhile, more affordable areas like Tampa, Orlando, Dallas, Atlanta and Phoenix continued to draw thousands of potential new residents. The analysis is based on a sample of more than 1 million Redfin.com users who searched for homes across 80 metro areas from July through September 2018.
Nationally, 25 percent of Redfin.com home searchers looked to move to another metro area in the third quarter, compared to 22 percent during the same period last year. Affordability continues to be a driving factor causing people to move away from the coasts.
"Rising mortgage rates are exacerbating affordability issues that have been driving people out of expensive coastal metros for the past few years," said Redfin chief economist Daryl Fairweather. "With rates no longer near historic lows, buyers are increasingly cost-conscious, seeking more affordable homes in low-tax states in the South and middle of the country."Moving Out - Metros with the Highest Net Outflow
San Francisco, New York, Los Angeles, Washington, D.C. and Denver posted the highest net outflows in the third quarter. Net outflow is defined as the number of people looking to leave the metro minus the number of people looking to move to the metro. A net outflow means there are more people looking to leave than people looking to move in, while a net inflow means more people are looking to move in than leave.Denver: Outflow Accelerates
After debuting on the list of top ten metro areas with a net outflow at number seven in the first quarter and moving up to number six in the second quarter, Denver moved up again in the third quarter to pass Chicago at number five. Of all Denverites using Redfin, 24 percent were searching for homes in another metro, up from 17 percent during the same time period a year earlier. Among the Denverites who were searching elsewhere, approximately 23 percent were looking at more affordable metros within the state: Colorado Springs and Fort Collins.
Of all San Francisco Bay Area residents using Redfin, 22 percent were searching for homes in another metro, up from 18 percent during the same time period a year earlier. Of New Yorkers, 34 percent looked to leave, about the same as last year. Of Los Angelenos, 16 percent looked to leave, compared to 15 percent last year.Moving In - Metros with the Highest Net Inflow
The places attracting the most people are mostly the same regions that have been growing throughout the past year, including Sacramento, Atlanta, Phoenix and Portland. The metro areas seeing the biggest inflows of new residents are the big cities where home prices are still relatively affordable and job markets are strong. Median prices in the metro areas seeing the largest net inflow average around $150,000 below prices in the metro areas with the largest net outflow.
"We talk with a lot of people moving to Atlanta from areas experiencing more of a slowdown, and they seem to think Atlanta is too good to be true," said Atlanta Redfin agent Ashley Ward. "Benefits of Atlanta that keep drawing people here include top-notch public education, affordable housing, an appreciating market and more job opportunities."