A new look at renter migrations from Zillow has confirmed what might seem apparent on its own‒‒renters are flocking to more affordable cities with solid economies and looking to get out of higher-priced areas, even if the economy is good.
Among large cities, renters in Nashville, Raleigh, and Austin are most likely to move from another city. Similarly, renters in San Jose are highly likely to be from elsewhere, but they’re also more likely than renters in any other major city to be looking to leave. San Jose topped Zillow’s exodus list, but was third on its list for cities renters are flocking to.
According to Zillow, affordable cities like the aforementioned three, which have strong economies and vibrant cultures, are most attractive to renters from other parts of the country. Meanwhile, in San Jose and San Francisco, which are major tech markets, draw residents in a revolving door. Many want in, but many want out at the same time.
In San Jose and San Francisco, where housing affordability has deteriorated to crisis levels, Zillow reported, renters seeking to move away have smaller or equal incomes to those seeking a new rental within the region. Los Angeles, New York, Boston and Seattle are not far behind, with renters seeking to leave the region reporting only slightly higher incomes than renters seeking to move within the region.
Other markets with a higher percentage of renters looking to move out include Pittsburgh, Baltimore, and Virginia Beach. Such places, Zillow reported, are often characterized by slower job growth and high numbers of students and military families.
“An influx of people moving to new cities is among the drivers affecting demand and therefore affordability in many of today's housing markets,” said Zillow chief economist Svenja Gudell. “Rising rents become even more pronounced in booming markets like Nashville, Portland, and Denver, not only because so many people want to move in, but also because so few people want to move away. There aren't enough rental homes to go around and the rents have nowhere to go but up.”
According to the Zillow Group Report on Consumer Housing Trends, the average renter spends 10.4 weeks searching for a home. Generally speaking, the higher a renter's income, the faster they tend to find a home. Renters earning over $75,000 secure a place in fewer than 10 weeks on average, while those earning under $25,000 need nearly 12 weeks to find a new rental.