A recent report by realty company Redfin shows that buyers from outside a housing market are often responsible for driving housing prices even higher in the area to which they’re moving.
Out-of-towners “tend to be able to pay more than locals in popular migration destinations because they’re often relocating from more expensive areas,” the company said in its report.
The company analyzed several locations from which it drew its data, including Austin, Texas, where outside home purchasers were markedly higher than in-town ones:
The typical home purchased by out-of-towners in Austin sells for $470,000, versus $447,500 for locals. Out-of-towners also tend to buy homes that are priced higher from the beginning: The typical list price for a home purchased by out-of-towners is $439,900, versus $425,000 for locals. Migrants also have higher down payments than locals, with a median of $111,500 versus $83,725 for locals.
Boise Redfin agent Kristin Lopez said the midwestern town has seen “young homebuyers move here from expensive parts of California and Washington,” who “tend to have more money for down payments and monthly mortgage costs coming from several sources: high salaries, proceeds from the sale of their home in a place like San Francisco or Seattle and gifts from family members.”
The local housing market, she noted, “is tough for locals because there’s a huge gap between Idaho wages and house prices,” which wealthier out-of-towners are more able to exploit.