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Once a hotspot during the COVID-19 pandemic, Austin, Texas, might be losing its migration momentum.
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Key findings from a Redfin report in October indicated that more homebuyers were interested in moving out of Austin than moving in. This was based on the searches of nearly 2 million Redfin.com users who viewed for-sale homes online across more than 100 metros from July to September.
Data revealed the number of Austin-based Redfin users looking for homes outside Austin more than doubled over the last year. According to Redfin, this is the first time on record there hasn’t been a net inflow into Austin.
What are some of the key issues surrounding Austin’s waning popularity and which cities do Austin homebuyers plan to relocate to next?
Why Are Homebuyers Thinking About Leaving Austin?
The idea of leaving Austin may have been on Austin-based homebuyers’ minds even sooner than 2023. According to moveBuddha’s 2022-23 Austin Migration Report, the search volume for moves into the Austin MSA has been trending downward since August 2021. What gives in a city known for keeping it weird?
Rising Home Prices
Austin’s housing prices are quickly becoming expensive, even rivaling the coasts for costs. According to Redfin, the gap between Austin’s home prices and those in cities with notably expensive real estate, like San Francisco and Los Angeles, is smaller than it was before.
Monthly mortgage payments have doubled, meaning these payments are now more expensive than ever before and stretching households financially thin.
“Even with 20% down, the level of payment required when you take into account the mortgage, property taxes, insurance and maintenance is well beyond the average household income for this part of Texas,” said Clint McCalla, a CFP and client advisor at MEIRA who is based out of Austin.
It’s Not Austin: It’s My Employer
Some homebuyers are not leaving Austin because they personally want to, but because they need to keep their jobs.
According to Redfin, Austin-based Redfin agents have said some formerly remote workers have received return-to-office mandates from their employers.
Millions of Texans struggled with extreme heat and soaring temperatures in the summer of 2023.
If rising prices or office mandates don’t encourage homebuyers to move out, the Texas Standard made an argument that a climate-induced migration might be underway for homebuyers in Austin and the overall state of Texas.
Which Cities Are Homebuyers Moving To?
If we step back from Austin-based homebuyers and look at homebuyers as a whole, most are moving to metros that are affordable, even if they are in particularly climate-risky spots. Redfin reported the top three metros homebuyers are moving into are Sacramento, Las Vegas and Orlando.
Now let’s go back to Austin-based homebuyers. Those who decide to leave Austin are choosing to stay in Texas rather than relocate out of state. Two of the most popular destinations, according to Refin.com users, are San Antonio and Corpus Christi.
McCalla also has seen many people “move down the road” to San Antonio and to more rural Texas communities. In San Antonio, McCalla said, home pricing is much better relative to the amount of home you receive.
The other slightly surprising city where Austin-based homebuyers are moving to? Their home city, which could be in Texas or out of state.
As McCalla said, “There is the normal pattern as well of those who moved to Austin over the last five to 10 years from various parts of the country returning to the areas they consider home.”
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