When COVID-19 first began to spread around the world in the most densely populated areas, many people fled CBD and metro areas to work from home or socially distance themselves in suburban and rural regions.
But now that the pandemic has been a part of our lives for over 6 months, many are making the decision that they want to live there in the long term. So, what initially seemed to be a temporary blip on the real estate radar, looks like it might turn into a far more significant exodus as the suburban boom continues to rise.
As these residents leave major hubs like New York and Sydney in search of suburban lifestyles, there’s been significant discussions by the usual commentators as to whether these major cities of the world will continue their decline in popularity, even after coronavirus has been handled. Because there’s mounting statistical evidence that shows urban dwellers might be making their way to the outer suburbs in a much more permanent nature.
Suburban real estate statistics
Looking at the data so far in 2020 regarding residential real estate, it shows that people are expressing profoundly more interest in suburban and rural and suburban homes.
According to real estate property listing websites, searches for suburban postcodes increased noticeably during the middle of 2020 to around double the rate of urban areas compared with the same period in 2019. While listings for suburban real estate often outpace those in urban areas, the difference between them recently is the second largest in the last five years.
While it currently takes longer to close on real estate deals due to the pandemic causing homes for sale to spend more time overall on the market, both suburban and rural housing markets aren’t experiencing the same delays as much. This is most likely caused by the very strong demand for homes in less urban areas.
But, as the suburbs are seeing an influx of people moving there, not all of them are lucky enough to actually purchase a home in these areas. And there are also many who are currently renters and are searching for longer-term rural and suburban rental properties.
Remote work is a driving factor
The surge in suburban home-buying reflects just how quickly and drastically the priorities have shifted for millions of potential homebuyers almost overnight. This is almost completely caused by the pandemic, as many businesses allowed people to work from home, and paying big city prices for less space simply isn’t too appealing right now.
This has left a large number of office spaces in both urban and inner-city areas empty in the short term, but even after a vaccine for COVID-19 does become widely available, many companies will likely continue to allow or even force their employees to work remotely.
Rocking the suburbs
The uncertain real estate climate and other virus-related concerns are encouraging many people to hold on to the real estate they have. As prospective buyers are flocking away from the big smoke, the overall demand is further exacerbated because those who are already living in suburbia are also staying put.
Increasing demand across the board for suburban and rural real estate might not even be telling the full story of how many people are searching for more spacious properties. In fact, the desire for more living space is also especially acute for many parents, who are now trading the conveniences of urban life for much more space in the great outdoors with often better schools.
A larger number of millennials have been living in major metropolitan areas over recent years compared to their Gen X predecessors, many of whom have been accumulating significant amounts of wealth with little to no property to show for it all. Now could be the perfect time for the younger generations to start taking their matchmaking skills of Tinder and Grindr and using it to their advantage with online platforms for real-estate sales.
As for the rest of us, if you’re thinking of buying or building your first home, now could be the opportunity to find excellent properties at reduced prices. And for homeowners, now is an excellent time to refinance your mortgage while taking advantage of reduced interest rates and increasingly flexible loan features.