News Releases

January 21, 2021 at 8:00 AM EST
Out-of-Towners Moving Into Nashville, Atlanta and Austin Have More Than 30% Bigger Homebuying Budgets Than Locals
Out-of-towners have bigger budgets than locals in 31 of the 34 cities included in Redfin's analysis, and they're driving up home prices

SEATTLE, Jan. 21, 2021 /PRNewswire/ -- (NASDAQ: RDFN) — Nashville tops the list of cities with the biggest budget difference between out-of-town and local homebuyers, according to a new report from Redfin (www.redfin.com), the technology-powered real estate brokerage. The average housing budget for out-of-towners moving to Nashville in 2020 was $719,500, 48% higher than the $485,500 average budget for local buyers. Next come Atlanta, where out-of-towners had an average budget of $698,000, 33% higher than the local budget, and Austin, where the average out-of-towner had an $852,500 budget, 32% higher than locals. 

The report is based on a Redfin analysis of the average maximum list-price filters for homes set by Redfin.com users in their saved searches.

"Many homebuyers are now able to widen their searches to parts of the country that weren't options when they were tied to offices in expensive cities, and the consequences for popular destinations will be numerous," said Redfin chief economist Daryl Fairweather. "That's great news for remote workers because their San Francisco salary can buy a lot more in Nashville or Austin than the Bay Area. And for locals, the influx of wealthy homebuyers is both good news and bad news. Homeowners will see the value of their homes rise, but first-time homebuyers will face tougher competition from out-of-towners with big budgets. Local economies will change as well, with people like construction workers, plumbers, childcare workers and landscapers seeing increased demand and increased prices for their services—but that would mean higher prices for locals as well."

The Nashville, Atlanta and Austin metros are all perennially on the top 10 list of most popular destinations for Redfin.com users moving from one metro area to another, and the number of people looking to move to each place increased by more than 40% year over year in late 2020. Homes in those metros are relatively affordable, though prices have been rising over the last several years. The typical home in Nashville sold for $330,000 in December, up 5.1% from $314,000 in December 2019. The median home-sale price in Atlanta was $285,000 in December (+13.7% YoY from $250,000), and in Austin it was $370,000 (+15.2% YoY from $321,000).

Californians are driving up home prices in Nashville and Austin

Nashville Redfin agent Mike Estes said he works with people moving in from Los Angeles, New York and Chicago on a weekly basis, and the number of  wealthy out-of-towners has increased over the last year as remote work exacerbates migration.

"I've lived in Nashville for 14 years and the joke is that $500,000 to $700,000 is the new $300,000 to $500,000," said Estes. "But those who have lived in the area for many years typically can't afford to spend $500,000 to $700,000 on a home, and they often move into the suburbs or even farther out to find a home within their budget. Local homeowners are pleased with the increase in their property values, but they aren't always able to capitalize on it because they can't afford to buy in the same hot market. Meanwhile, people moving in from Los Angeles tend to think $700,000 is inexpensive, and they're shocked they can afford a 3,000-square-foot home with beautiful finishes for that price." 

Austin was the most common destination for Redfin.com users looking to move to a different metro at the end of 2020, the first time the Texas capital topped the list. Nearly 150% more people looked to move into Austin in the fourth quarter of 2020 than the same time period a year before. 

"My nickname for Austin is Texa-fornia because so many people are moving in from California," said Sabrina Archolecas, senior asset manager for the Texas branch of RedfinNow, Redfin's iBuying business. "Buyers' agents are taking lawn chairs to showings because lines to get into properties are so long. People moving in from other parts of the country are making the market incredibly competitive and driving up prices like agents have never seen. One recent four-bedroom, 3,200-square-foot listing in Austin had 16 offers in one weekend; the list price was $575,000 and it sold for $638,000."

The Bay Area is the only place where locals have higher budgets than out-of-towners

Locals had higher budgets than migrants in just three of the 34 cities included in this analysis: San Francisco, San Jose and Fremont, CA (a city in the Oakland metro), all cities where migrants and locals alike have homebuying budgets well over $1 million. The average budget for a local in San Francisco was $1.76 million in 2020, 4.1% higher than the $1.69 million average budget for out-of-towners. 

The fact that locals had slightly higher budgets than migrants in those three cities is likely because the Bay Area has the highest median income in the U.S.

Average budgets of Redfin.com home searchers, out-of-towners versus locals, 2020

Ranking: Cities at the top of the list have bigger average budgets for migrants

City

Average maximum
budget for
migrants
(Redfin.com saved
searches)

Average
maximum budget
for locals
(Redfin.com saved
searches)

Percent
difference
between
budgets for
migrants over
locals

Median sale
price (Metro
area, Decembe
r 2020)

Nashville, TN

$719,488

$485,598

48.2%

$329,900

Atlanta, GA

$697,922

$523,193

33.4%

$284,700

Austin, TX

$852,276

$644,771

32.2%

$370,000

Houston, TX

$569,725

$434,284

31.2%

$273,000

New York, NY

$1,013,778

$798,010

27%

$550,000

Denver, CO

$882,266

$698,795

26.3%

$452,000

San Antonio,
TX

$461,971

$372,357

24.1%

$262,500

Philadelphia,
PA

$509,318

$412,159

23.6%

$245,000

Phoenix, AZ

$627,324

$509,059

23.2%

$240,000

Dallas, TX

$702,259

$578,801

21.3%

$323,900

Charlotte, NC

$553,857

$456,788

21.3%

$297,500

Washington,
D.C. 

$1,005,294

$849,954

18.3%

$450,000

Henderson, NV
(Las Vegas
metro)

$619,306

$524,163

18.2%

$320,000

Chicago, IL

$638,554

$549,961

16.1%

$270,000

Scottsdale, AZ
(Phoenix
metro)

$970,051

$839,704

15.5%

$240,000

Las Vegas, NV

$581,664

$503,962

15.4%

$320,000

Portland, OR

$758,683

$658,832

15.2%

$450,000

San Diego, CA

$1,139,410

$994,098

14.6%

$660,000

Sacramento,
CA

$615,886

$539,676

14.1%

$475,000

Oakland, CA

$1,233,800

$1,074,426

13.9%

$816,600

Los Angeles,
CA

$1,533,244

$1,347,995

13.7%

$730,000

Gilbert, AZ
(Phoenix
metro)

$547,422

$497,514

10%

$240,000

Boston, MA

$1,069,360

$974,973

9.7%

$550,000

Seattle, WA

$1,075,185

$1,003,120

7.2%

$625,000

Tacoma, WA 

$558,684

$528,376

5.7%

$435,000

Long Beach,
CA (Los
Angeles metro)

$885,374

$847,218

4.5%

$730,000

Baltimore, MD

$355,338

$343,119

3.6%

$305,500

Pleasanton, CA
(Oakland
metro)

$1,475,711

$1,426,303

3.5%

$816,600

Irvine, CA
(Anaheim
metro)

$1,241,524

$1,222,482

1.6%

$800,000

San Ramon,
CA (Oakland
metro)

$1,370,051

$1,356,789

1%

$816,600

Riverside, CA

$628,181

$624,971

0.5%

$450,000

Fremont, CA
(Oakland
metro)

$1,375,721

$1,420,132

-3.1%

$816,600

San Jose, CA

$1,329,339

$1,378,570

-3.6%

$1,195,000

San Francisco,
CA

$1,688,042

$1,760,206

-4.1%

$1,355,00

To read the full report, please visit: https://www.redfin.com/news/migrants-versus-locals-homebuying-budget 

About Redfin 
Redfin (www.redfin.com) is a technology-powered residential real estate company, redefining real estate in the consumer's favor in a commission-driven industry. We do this by integrating every step of the home buying and selling process and pairing our own agents with our own technology, creating a service that is faster, better and costs less. We offer brokerage, iBuying, mortgage, and title services, and we are the #1 nationwide brokerage website, offering a host of online tools to consumers, including the Redfin Estimate. We represent people buying and selling homes in over 90 markets in the United States and Canada. Since our launch in 2006, we have saved our customers over $800 million and we've helped them buy or sell more than 235,000 homes worth more than $115 billion.

For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email press@redfin.com. To view Redfin's press center, click here.

 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/out-of-towners-moving-into-nashville-atlanta-and-austin-have-more-than-30-bigger-homebuying-budgets-than-locals-301212272.html

SOURCE Redfin

Redfin Journalist Services: Angela Cherry, (913) 638-8249, press@redfin.com