64% say they prefer to work remote: How is this changing real estate?
The COVID-19 pandemic has brought about a seismic shift in the way Americans work, with remote work becoming the new norm. This transition has not only transformed our daily routines but has also had a profound impact on the real estate market. In this blog post, we’ll explore the key takeaways and statistics surrounding the rise of remote work and its influence on housing prices.
Key Takeaways:
- The Remote Work Revolution: In the wake of the COVID-19 pandemic, working from home has become widespread. The number of home-based workers tripled between 2019 and 2021.
- Population Shifts: Certain areas are experiencing significant population increases as remote workers relocate to more desirable locations. People are now free to choose where they live based on factors beyond their workplace proximity.
- Housing Price Surge: The shift to remote work has led to a surge in housing prices, both for purchases and rentals. The Federal Reserve Bank of San Francisco noted a 24 percent increase in housing prices between November 2019 and November 2021, with over 60 percent attributed to remote work.
Key Statistics:
- Pew Research Center Study: Over 35 percent of workers with jobs that can be done remotely are now working from home full-time.
- Bankrate Study: 64 percent of U.S. adults in full-time employment or seeking it support a fully remote work schedule over a fully in-person one.
- FRBSF Report: Housing prices rose by 24 percent between November 2019 and November 2021, with more than 60 percent of the increase attributed to remote work.
- Bankrate’s April 2023 Financial Security Survey: 42 percent of U.S. adults who do not own a home blame high home prices.
- Mortgage Rates: The average 30-year mortgage rate is at a two-decade high of 7.36 percent.
Impact on Home Prices:
The COVID-19 pandemic has redefined the concept of “home” for many households. With the freedom to work remotely, people are making location choices based on factors like proximity to family, climate, and lifestyle preferences. This reshuffling has increased demand, resulting in a surge in home prices, potentially causing sticker shock for prospective buyers.
The Rental Market:
The cost of rent has also seen an increase due to the rise of remote work. Evidence suggests that remote work has caused a relative increase in demand for all types of housing, further contributing to the housing price surge.
Where Home Prices Are High:
Certain areas, particularly in Florida and cities like Boise, Austin, and Phoenix, have seen significant growth due to the influx of remote workers. This has led to skyrocketing income levels for the typical homebuyer. However, it has also created challenges for housing availability, leading to locals being priced out of their own communities.
Conclusion:
The remote work revolution is reshaping not only the way we work but also our choices in where we live. With the demand for remote work remaining strong, this trend is expected to continue. Understanding the impact of remote work on the real estate market is crucial for both potential homebuyers and renters in navigating this new landscape.