How Remote Work Helped Push Home Prices to Record Highs
Home prices increased by 23.8% during the pandemic, based on an analysis of Zillow’s home price index from December 2019 to November 2021. A recent study, completed by researchers from the Federal Reserve Bank of San Francisco and the University of California, San Diego, for the National Bureau of Economic Research, found that more than 15% of home price growth came from remote workers seeking bigger, better, and often warmer places to live.
In Austin, for instance, an up-and-coming tech hub even before the pandemic, the median price for single family homes spiked 26% during 2021’s fourth quarter, according to research from the National Association of Realtors. Housing prices also rose by 26% in Phoenix and by 24.3% in Boise, Idaho.
“Migration to places like Austin [Texas] and Raleigh [North Carolina] has been happening for a while, but the pandemic accelerated it because of the un-tethering between an office and home that has allowed people to make choices about where they want to live,” Chris Glynn, senior managing economist at Zillow, told CNN.com.
Research showed that cities friendly to remote work pre-pandemic had the most growth as people changed jobs — and locations.
“We were pretty shocked remote work had this impact, once we saw the estimates,” Johannes Wieland, co-author of the study and associate professor of economics at UC, San Diego, told CNN. He noted that it was not just people changing locations that drove up housing prices, but those staying within major metro areas and seeking bigger, more comfortable homes.
3 Things Remote Workers Look for in a Hometown
By looking at the areas with the most growth during the pandemic, researchers discovered three key attributes that make a city desirable to remote workers.
First, remote workers tend to flock to areas, like Austin, with industries that are conducive to remote work. While, theoretically, remote work means you don’t have to live anywhere near your company, it helps to be in the same time zone, or even the same region for those occasional trips to the office or lunches with colleagues.
Second, affordable housing and larger homes play a key role in attracting remote workers. “Lower density areas are more attractive to remote work,” Wieland told CNN.
Finally, lifestyle and climate factor into the decision of where to live if you can live anywhere in the world. That explains the influx of remote workers to places like south Florida and the Sun Belt, as well as Austin, which is known for its vibrant downtown and active nightlife.
And, as the “Zoomtown” trend continues to grow, so will these cities. Check out some of the best places to live if you’re a freelancer or remote worker.
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