Rising mortgage rates and persistently high home prices are driving residents of Los Angeles and other major cities to seek homes in cheaper metropolitan areas.
For Angelenos in particular, Las Vegas and San Diego have become the top two places for people looking to buy a home in another city, according to research by Redfin.
The real estate brokerage site found that a “net influx” of 7,000 Los Angeles-based home buyers were looking to buy property in Las Vegas, while 6,800 were looking to buy in San Diego, according to the study.
Net inflow is determined by taking the total number of Redfin house seekers looking to move into an area minus the number looking to leave.
“With a looming recession and high household spending, many people cannot afford to buy a home in an expensive area and/or want to save money in an emergency, making relocation to a more affordable place an attractive option,” Redfin said. Head of economic research Chen Zhao.
Los Angeles isn’t the only metro area seeing an exodus of potential buyers.
San Francisco had the most departures possible, with a net exit of 37,800. Los Angeles was next with 33,600, followed by New York; Washington D.C.; and Boston.
Overall, homebuyers are generally looking for places in cheaper and warmer climates, according to the study.
The country’s top destination was Sacramento, which, despite higher-than-average house prices, is still much cheaper than neighboring San Francisco.
“More than half of my buyers in Sacramento are from outside the region,” said Redfin agent Samantha Rahman. “These are mostly remote workers from the Bay Area who may need to travel to the office a few times a month, but save significantly on housing costs.
The study also noted that the increase in working from home since the pandemic has made it easier to find housing in different metropolitan areas.
Los Angeles Times