The New Gold Rush: Here Are the Top 10 Cities Job Seekers Are Now Flocking To

Workers able to work remotely have moved to and taken jobs in more affordable areas. But as more people move in, things may not be cheap for much longer.

The post The New Gold Rush: Here Are the Top 10 Cities Job Seekers Are Now Flocking To appeared first on Real Estate News & Insights | realtor.com®.

Everyone by now has heard of the “Great Resignation.” Workers all over the country—whether burned out, fed up, or just experiencing serious post-pandemic wanderlust—have decided now’s the time to finally call it quits.

However, there’s another transformative workforce trend also emerging, one that may have an even bigger long-term impact. Think of it as the “Great Reshuffle.” Because Americans aren’t just quitting old gigs—they’re also taking on new ones, wherever they may be. And often that means pulling up roots and buying or renting a home in a brand-new town, city, or state.

Thanks to the rise of remote work over the past year and a half, white-collar workers who can work from anywhere have been taking advantage of that freedom in ever-increasing numbers. Those previously desk-bound employees have moved away from the coasts to more affordable locales. Amid the shuffle, some workers have found perennial favorites like New York and San Francisco less attractive. They’re more drawn to states where housing costs are lower and where newer tech hubs are emerging.

To find out where folks are picking up and moving the most for work, the data team at Realtor.com® examined workforce migration data numbers provided by the employment website LinkedIn. We then dove deeper to investigate the impact on local real estate markets affected by this reshuffle. What we found were cities clustered in the South and West, all with steady economic growth, an abundance of jobs, and a lower cost of living.

“These regions have two big advantages: The weather is relatively warm, and housing is more affordable, says Guy Berger, principal economist at LinkedIn. “That was already making them big attractors to talent even before the pandemic. Now, with remote work more prevalent … that attraction has been turbocharged.”

But with the continued influx, these towns may not be cheap for much longer. In fact, our data shows the median list price in all but one of these cities below has seen double-digit growth compared with the same time a year ago.

It has become something of a cycle: New workers who need housing drive up competition for homes, and if they come from pricier areas like California, they can flex their buying power to crowd locals out of the housing market.

“An influx of newcomers is best viewed as an opportunity, not a challenge—creating more economic opportunities for everyone,” says Berger. “But without building more homes, this influx could also put upward pressure on home prices and rental costs—thereby reproducing the same problems experienced by big coastal metro areas.”

To arrive at our top 10, we analyzed data from LinkedIn, which has information on more than 180 million members in the United States. Migration is defined as when members change the location on their LinkedIn profile. To calculate the migration rate, LinkedIn looked at the number of migrants in a metro area who had changed their location over the past 12 months and then divided that by the total number of people in that area with LinkedIn profiles. To allow for more geographic diversity, we included only one metro area per state. (A metro area includes the main city and surrounding towns, suburbs, and smaller urban areas.)

The reshuffling of America may just be starting! So where is it currently having the biggest repercussions in real estate? Let’s have a look.

1. Austin, TX

Austin Texas
Austin, Texas

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New workers per every 10,000 LinkedIn members: 150
Median list price in October: $549,900
Percentage change from a year ago: 33%

Austin has been one of the hottest real estate markets in the U.S. for some time now, thanks to its burgeoning tech scene and a bevy of businesses relocating there.

The state capital boasts offices for most of the major tech companies, including Dell, Samsung, Apple, and Google. Even billionaire Elon Musk sees the potential in the Lone Star State. The Tesla founder announced in October that he will be moving the headquarters of his electric car company, in part because of high housing prices and untenable commutes for his employees in California.

Most transplants are coming from the San Francisco Bay Area, Los Angeles, and New York City, according to LinkedIn data—a signal workers are ditching pricier tech hubs in favor of Austin’s potential.

About 16% of people who’ve moved to Texas have come from California, says Luis Bernardo Torres, research economist at the Texas Real Estate Research Center at Texas A&M University. They’re drawn to more affordable housing and the lack of state income tax, although admittedly property taxes are high compared with the rest of the South.

“People vote with their feet, and they’re voting for Texas,” says Torres.

However, the influx of tech workers has put pressure on the local housing market. Home prices in Austin were up more than 30% last month compared with the same time a year ago, according to Realtor.com listing data. Meanwhile, rents are even higher than pre-pandemic levels, up 20% from March 2020 to September 2021.

2. Sarasota, FL

New worker rate: 138
Median list price: $495,000
Percentage change: 32%

In general, Florida has seen a huge influx of new residents thanks to its gorgeous weather, lack of state income tax, and healthy job market.

Those are just some of the reasons the Sunshine State has the hottest condo market in the country as well as some of the highest growth in rental costs. In fact, had we not limited our list to one per state, Florida would have shown up several more times with Cape Coral, Tampa, Destin, and Jacksonville all burgeoning with new residents over the past year.

Along the Sunshine State’s Gulf Coast, tourism is a major industry in Sarasota—and the area has seen more visitors in recent months with vaccinated folks in search of a getaway on the water. Other key local industries include manufacturing, shipping, education, and health care.

But with so many people moving in, there aren’t enough homes to go around, which has sent prices shooting up across the state.

“We have a lot of influx in our area and not enough rooftops to cover it,” says Alma Alexander, a listing agent with Coldwell Banker in Tampa.

3. Myrtle Beach, SC

Myrtle Beach South Carolina
Myrtle Beach, South Carolina.

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New worker rate: 102
Median list price: $368,520
Percentage change: 40%

Myrtle Beach is generally thought of as a retiree town, but lately, it’s not just boomers helping this city boom.

Many of the people buying homes here in the past year and a half were folks with families who wanted to work remotely in a beachside location, says Radha Herring, a Realtor® with Watermark Real Estate Group.

“In the midst of lockdowns and schools going virtual, they realized that they could work and go to school from anywhere,” says Herring.

Other local employers here include hospitals, schools, and Coastal Carolina University.

4. Asheville, NC

New worker rate: 92
Median list price: $469,000
Percentage change: 7%

Artsy Asheville is nestled in the gorgeous Blue Ridge Mountains. It attracts newcomers with easy access to nature, a quirky vibe, a plethora of excellent restaurants, and a brewery on seemingly every other corner. But there’s more to the place than tourism and beer, as one local newspaper put it.

Automotive factories, tourism, health care, and manufacturing are big drivers of the economy. They include companies such as parachute-maker Mills Manufacturing, GE Aviation, and Linamar, which makes automobile parts, industrial equipment, and electric products.

Home prices have gone way up here lately, in part because there’s more competition from people moving to the area, according to Lauren McKinney, an agent with Beverly-Hanks Realtors in Asheville.

“Unfortunately for the locals, the people coming in have cash,” McKinney says. “They can sell their condo in Miami and pay cash for a million-dollar house. Unfortunately for the people in Asheville who are trying to get a mortgage, their offer just isn’t competitive.”

North Carolina, in general, has become a popular state for job seekers since the pandemic. Beach and college town Wilmington, the Research Triangle area of Raleigh/Durham/Chapel Hill, and Charlotte all saw big increases in workers moving there.

5. Nashville, TN

Nashville Tennessee
Downtown Nashville, Tennessee.

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New worker rate: 89
Median list price: $450,000
Percentage change: 13%

Music City was hit hard at the start of the pandemic, but other key industries have been driving a steady stream of people moving South.

Nashville has started to become a tech hub in its own right, with Amazon and Oracle both building campuses in the area. Another key industry here is health care—including pharmaceuticals and hospital software.

Workers from New York and Chicago have steadily been making their way to Nashville, says Angela Wright, a real estate broker with Compass in Nashville.

“They feel like they’re getting a pay raise because of the tax savings of not having to pay state income tax,” Wright says of remote workers who’ve chosen to make Nashville home.

6. Boise, ID

New worker rate: 81
Median list price: $530,000
Percentage change: 25%

Boise is another city that has seen smoldering growth over the past few years that has fully ignited since the pandemic.

People are flocking to the area to enjoy its natural treasures, says Jeff Wills, president of Boise Regional Realtors. Recreational options abound here, including hiking, skiing, and river rafting.

Agriculture is a dominant industry in the area, but the area long known only for potatoes was recently named a top up-and-coming tech market, according to real estate investment firm CBRE. HP Inc. and Micron Technology both have offices there.

“Idaho is the first state in the country to see job growth recover—and even exceed pre-pandemic levels in almost all industries,” says Lloyd Allen, managing director for CBRE in Utah and Idaho.

Median list prices for Idaho as a whole were up 28% last month compared with a year earlier, according to Realtor.com data. That’s been a huge boon for homeowners in the state, where two-thirds of all homes are equity rich. But it makes life tougher for those looking to buy a home for the first time.

“Anytime you have a resource that is already limited in nature, you have more people demanding more supply, it’s going to have an impact on the median price,” says Wills.

7. Huntsville, AL

Huntsville Alabama
Downtown Huntsville, Alabama.

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New worker rate: 72
Median list price: $349,000
Percentage change: 17%

Known widely as Rocket City, Huntsville is home to the NASA Marshall Space Flight Center, making it one of the major research and aeronautics hubs in the South. Other high-tech industries in the area include information technology and cybersecurity. Facebook, Toyota, and Jeff Bezos‘ space company Blue Origin all have a presence there.

The inexpensive housing stock is also a draw, says Matt Curtis, who owns an eponymous real estate firm in the area.

“Even with recent price increases and appreciation in home prices, we’re still below the median sales price for the rest of the country,” Curtis says. Investors are also looking to scoop up homes in the area, creating a squeeze on inventory.

“It is creating a challenge for first-time local buyers who don’t have the equity to pay above list price.”

8. Denver, CO

New worker rate: 61
Median list price: $615,000
Percentage change: 18%

The Rocky Mountains are beckoning workers to the capital of Colorado, with natural recreations in the mountains and a bustling tech sector. Mile High City is the headquarters of Frontier Airlines and is home to several big tech firms. As one of the first states to legalize recreational marijuana (way back in 2012), Colorado is a leader in that industry as well.

The influx of workers is sending housing costs ever higher. Median rents in Denver have surged 14% in the past year, according to Realtor.com data.

“This is the real challenge right now for a lot of people in these cities” whose economies depend on tech, says George Ratiu, manager of economic research for Realtor.com. “Many in those markets are finding their rents being increased by significant amounts.”

9. Portland, ME

Portland Maine
Portland, Maine.

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New worker rate: 59
Median list price: $469,900
Percentage change: 11%

Natural beauty and a slower pace of life have proved a potent combo for the only city in the Northeast on this list. Residents can take in the gorgeous fall colors near picturesque trails or ride a ferry to one of Portland’s secluded but lovely islands. The local port, L.L. Bean, and the health care industry are major employers, and manufacturing and distribution are key industries.

Low-cost real estate has always been a draw here, but out-of-state competition is driving up prices and putting pressure on local workers. Still, the city is a homebuyer’s bargain compared with some other cities nearby.

“The cost of real estate is so high in major metropolitan areas like New York that they see a way of becoming debt-free by just investing in Maine real estate that’s essentially probably half the price,” says Davian Akers of Keller-William Realty in Portland.

10. Phoenix, AZ

New worker rate: 54
Median list price: $485,000
Percentage change: 17%

The fifth-largest city in the U.S. boasts warm, sunny weather all year long, plus access to some of the greatest natural wonders of the world, including the Grand Canyon. In addition to the weather, a booming tech market has also helped draw in new workers. Delivery service DoorDash has a presence here, and used-car retailer Carvana has headquarters in nearby Tempe.

A massive shortage of housing has been an issue in Arizona, but builders are feverishly buying up land to put up more homes says Kristy Ryan, a real estate associate at Re/Max Fine Properties in nearby Scottsdale. This brings some hope that more construction could help cool down prices.

“We have a ton of big-time national homebuilders that haven’t been here before coming into our market,” Ryan says. “They know there’s a huge demand here and an enormous shortage.”

The post The New Gold Rush: Here Are the Top 10 Cities Job Seekers Are Now Flocking To appeared first on Real Estate News & Insights | realtor.com®.