Real Estate

Home Prices In Car-Dependent Markets Soared During Pandemic

During the pandemic, home prices in car-dependent markets grew twice as fast as home prices in transit-accessible markets, according to a new report by Redfin.

New data continues to reveal the impact remote work is having on the consumer-preference shift in the housing market.

Per a recent report by Redfin, during the pandemic, home prices in car-dependent markets grew twice as fast as home prices in transit-accessible markets.

Car-dependent markets often encompass rural, suburban, and suburban-like neighborhoods. Transit-accessible markets on the other hand, are often in densely packed cities.

Redfin found that from January 2020 to May 2021, home prices grew 32.8 percent to $418,100 in car-dependent areas nationwide. For the same period of time, home prices in transit-accessible areas grew 15.6 percent to $540,500.

“Remote work has allowed many homebuyers to leave cities for far-flung suburbs. Those suburbs often lack public transit, so new residents drive more often,” Redfin Chief Economist Daryl Fairweather was quoted in the report.

In addition to prices rising at a faster pace, home buying in car-dependent areas has also been more competitive than in transit-accessible areas. According to the report, in May 2021, 56 percent of homes in car-dependent areas sold for above asking price compared to 36.4 percent in transit-accessible areas. 

 “For most people, the tradeoff wouldn’t have been worth it two years ago because of the hours-long commute into San Jose or San Francisco every day, either by train or by car,” Steven Majourau, a Redfin agent in California, said in a statement. “With remote work, buyers can prioritize the actual home above its proximity to transportation.”

But will the power of remote work continue to hold its grip on the housing market as the nation inches toward a post-pandemic reality? 

Earlier this month, agents told Inman that some homebuyers are being called back to the office earlier than expected, and it’s forcing them to drop out of deals and list the homes they just moved into.

Brandon Kekich, a Realtor with RE/MAX in the suburbs of Detroit, told Inman he’s already working with two Ford Motor employees who, after moving about an hour away from the office last summer, are now being called back in. They moved because they thought they had at least two years of remote work ahead of them, he explained. 

Agents in San Diego, Hawaii, and Texas have all reported experiencing the same phenomenon. 

“I had a cancellation shortly before closing date,” Kinga Mills, an Inman Brand Ambassador and Realtor with Hawaii Life, wrote to Inman on Facebook. “NY employer decided that they wanted everyone back in the office, which totally screwed my client.” 

And while the trend of having to move closer to the office is still in its early stages, some people are hoping it will continue.

“People here are HOPING that folks who bought homes during the pandemic in the hopes of working from home for the foreseeable future will be called we have more inventory!” Julie Chancerelle Ziemelis, a co-founder and owner at Move To Hawaii 365, wrote on Facebook.

Email Libertina Brandt

What's your reaction?

In Love
Not Sure

You may also like

More in:Real Estate

Leave a reply

Your email address will not be published. Required fields are marked *