Rising mortgage rates and persistently high home prices are causing residents of Los Angeles and other major cities to search for homes in cheaper metro areas.
For Angelenos in particular, Las Vegas and San Diego have emerged as the two premier spots for people looking to purchase a home in a different city, according to a study by Redfin.
The real estate brokerage site found that a “net inflow” of 7,000 Los Angeles-based home buyers were looking to purchase property in Las Vegas, while 6,800 were looking to buy in San Diego, according to the study.
The net inflow is determined by taking the total number of Redfin home searchers looking to move into one area minus the number looking to leave.
“With a recession looming and household expenses high, many people can’t afford to buy a home in an expensive area and/or want to save money in case of an emergency, which makes relocating somewhere more affordable an attractive option,” said Redfin Economics Research Lead Chen Zhao.
Los Angeles is not the only metropolitan area seeing an exodus of potential home buyers.
San Francisco saw the largest possible departure numbers, with a net outflow of 37,800. Los Angeles came next with 33,600, followed by New York; Washington, D.C.; and Boston.
Overall, home buyers generally are searching for spots in cheaper, warmer climates, the study found.
The top destination in the country was Sacramento, which, despite it’s higher than average home prices, remains far cheaper than neighboring San Francisco.
“More than half of my buyers in Sacramento are from outside the area,” said Redfin agent Samantha Rahman. “They’re mostly remote workers coming from the Bay Area who may need to commute to the office a few times a month but are saving significantly on housing costs.
The study also noted that rising work from home setups since the pandemic have made it easier for people to look for homes in different metro areas.
