It’s not just emotional purchases, brokers say: There are smart and strategic reasons why Americans of all ages, races and incomes are moving away from urban centers.
Why it matters: Bidding wars, terrifying plays for a large suburb house with a pool, buying an invisible amount of real estate – they are all part of the calculation of Americans that our lives and lifestyles have been permanently changed by coronavirus and that we need more space for the long term (inside and out).
The news ride: There is a golden rush in real estate in the US, driven by record-low mortgage rates and the dull realization that for many of us, our homes will be the only place we work and play for the foreseeable future.
- The trend began in the spring when school was canceled in many areas, and has gained steam because companies have allowed workers to work from home (in some cases, indefinitely) and as question marks have arisen over personal school this fall.
- While spacious single-family homes in suburbs and suburbs are in high demand, apartment rentals are falling in places like Manhattan, where mercenaries are offering deals to lure tenants.
What buyers are looking for: Fresh air, backyards, home offices (for two adults), a home care area, pet space, home gyms – plus close to beaches, lakes, parks and bike paths.
- “Preferences have been moved from ‘what is a prestigious location?’ to ‘what is practical?’ and ‘what is the quality of life we want for our households?’ “Anna DeSimone, a housing finance expert who writes manuals for consumers and mortgage lenders, tells Axios.
- Search the Compass Real Estate website for houses with pools has tripled, searches for households have increased by 40%, and searches for homes and co-ops have decreased, Compass CEO Robert Reffkin told CNBC.
As more people do their shopping and shopping online, close to the shops is not a priority for real estate.
- “We don’t hear so much round brick-and-mortar where it’s closest to this or that,” said Kris Lindahl, CEO of a real estate firm in Minneapolis-St. Paul area, tells Axios. “Instead, it’s ‘can we get delivery here?'”
Between the lines: Some people move because they find that – now that they spend most of their time in the same place with the same people – they are not happy with their current housing.
- “If you spend nine-plus hours a day at home, you will see things differently,” Lindahl says.
By the figures: Existing home sales rose 20.7% in June to May, and median housing prices have risen in every region of the country, according to the National Association of Realtors.
- Sales growth is particularly pronounced in more affordable regions such as the South and Midwest, Lawrence Yun, the NAR’s chief economist, told Axios.
- One new trend he identified: “People who want to shop in the suburbs and away from city centers.”
Unlike in decades past, makes the move to the suburbs net represent “white flight”, but rather the phenomenon of work-from-home, says Yun Axios.
- “The people who move to the suburbs are of all races and ethnicities,” Yun said, noting that equal access to housing in all areas is “the law of the land.”
Inventory of available homes for sale – which was still low before the pandemic – has grown even faster, to the point that brokers are knocking on the doors of desirable homes and asking residents if they want to consider selling it.
- “It’s become useful over the last few weeks,” Andrea Paro, an agent at Compass Real Estate in Bethesda, Md., Told Axios. “I’m trying to fasten my seatbelt and just drive through.”
- She recently reported a single family home in Falls Church, Va., And immediately received 64 requests for showings. “I will probably get 10 offers,” she says.
Despite the logic in the market, what percentage of buyers make purchases based on panic or other emotions – and these are the ones who may be ruining their decisions or finding that their homes do not hold their value.
- In the New York City area, this could mean buyers “pay $ 50,000 more so they can move to Connecticut and ride their bikes and go to the beach,” says DeSimone.
- All too often, she says, “If people make an emotional or hasty decision, those investments in real estate will not grow.”
Go deeper: Older millennials are on the run to “hipsturbia”
.
