The COVID-19 pandemic is reshaping our definition of "home." We've seen adult children move in with parents, millions of workers turning their apartments and houses into offices, and individuals and families giving up their brick-and-mortar structures and adopting the "van life."
Real estate professionals — brokers, agents and investors — have new opportunities as consumers and businesses make new and sometimes novel choices about where they will put down roots. Here are the top trends to watch as the pandemic and its effects continue into 2021.
The Top 7 Migration Trends
- Temporary relocation boom. At the onset of the pandemic, we saw many interim moves as people fled cities for areas that they perceived as being less crowded and, therefore, safer. We saw a nearly 27% boost in temporary moves. People left major cities such as New York, San Francisco, Los Angeles, Washington, DC, Houston and even Naples, Florida.
- We are seeing a rise in multi-generational households. The Pew Research Center reported that the number of adult children living with parents jumped from 47% to 52% between February and July 2020. Some parents who were in assisted living facilities or other communities have moved back in with their grown children as a safety precaution.
- Smaller cities grow in appeal. Among the cities that saw year-over-year gains in inbound populations are:
- Houston (6% increase)
- Raleigh, North Carolina (6% increase)
- Tampa, Florida (5% increase)
- Las Vegas (5% increase)
- Denver (3% increase)
- Phoenix (2% increase)
- Movers are following the sun. Although many people still appreciate the change of seasons and winter snow, we're seeing an influx of homeowners and renters to states like Arizona and South Carolina.
- "The suburbs are having a moment." According to MReport, a trusted mortgage media outlet, workers are choosing to invest in communities with great amenities and low cost of living. Because proximity to work is no longer a factor in living decisions (at least temporarily), consumers are choosing the quality of life over commuting time. For example, people leaving Houston are opting for communities such as Katy, Cypress, Spring, Richmond and Humble, according to the Report.
- Luxury homes are selling. Affluent consumers are taking advantage of low mortgage rates and investing in big homes. Sales of $5 million (and up) properties in the Hamptons grew at a rate of almost 300%.
- Evictions and defaults may cause future churn. Although legislation has postponed mass evictions among unemployed workers, we may ultimately see huge shifts in vacancy rates as renters continue to suffer financial hardships. Mortgage delinquencies are at their highest rate in 20 years, according to data from CoreLogic.
How to Leverage New Opportunities
Intimately knowing the high-potential communities for home buying is more important now than ever before, and having access to current and comprehensive data is increasingly vital. Sharing that market intelligence with prospects and customers gives you a competitive edge.
Smart brokers and agents are aligning themselves with real estate professionals in "hot" areas so they can handle both sides of a buy/sell transaction.
Remember that moving (even temporarily) can be stressful for homeowners and renters. Establishing yourself as a trusted partner throughout the process can help you build relationships that last for years to come — and result in high-quality referrals.