Spring home buying season is heating up, ushering millions of prospective buyers into the housing market.
But while economic headwinds continue to impact American wallets, which housing markets are actually affordable for these eager shoppers?
Redfin’s latest migration report indicates that more and more Americans are heading to inland markets, where the cost of living remains relatively affordable.
This is seen in Atlanta, where 45.7% of homes for sale are affordable on the median U.S. household income of $61,372, according to the company’s recent affordability report.
“People who are willing to move across the country can still find affordable housing,” Redfin Chief Economist Daryl Fairweather said. “Atlanta is a popular migration destination because of its relatively low housing costs and strong jobs market.”
In fact, Fairweather notes that Atlanta’s job market is so robust that it has begun to attract more Bay Area homeowners, which has encouraged tech companies like Pandora and Square to open offices in the metro.
Notably, Redfin’s data also reveals a similar pattern in Phoenix, Arizona, which has become home to many west coast homeowners.
“A lot of Phoenix homebuyers are transplants from California, moving to capitalize on the lower cost of living,” Redfin agent Katie Shook said. “I recently worked with a couple who used the equity from their Bay Area home for a down payment on a home here. The wife kept her job and is able to work remotely, and the husband was able to retire.”
Even if Phoenix or Atlanta residents decided to take jobs with each metro’s typical salaries, Redfin’s data indicates that the portion of affordable homes still remains substantially higher than in San Francisco.
“The higher share of affordable homes for sale in Phoenix and Atlanta than San Francisco is one reason why the San Francisco metro, where the median home sale price is $1.3 million, topped the list of metro areas Redfin users were looking to leave in all four quarters of 2018,” Redfin writes. “It also helps explain why the Phoenix and Atlanta areas, where the median sale prices are $267,000 and $230,000 respectively, were both among the five most popular destinations each quarter of last year.”
NOTE: Redfin's data is based on its affordability dashboard, which allows users to compare affordability among different parts of the U.S.
