The Post-COVID Appeal of Suburbia
Do homebuyers want the same things in their next home as they did before the COVID pandemic? In some ways, yes, and in others, no. According to the latest summertime Realtor.com survey, post-COVID homebuyers are willing to spend more money on a home, have saved more money toward a downpayment as they sheltered in place, and plan to buy a home sooner than they did during the pandemic of 2020.
A greater majority of homebuyers surveyed also said they want a three-bedroom home, with two bathrooms, an updated kitchen, and a garage. In a comparison of surveys between conducted in both the spring and summer 2020, a notable share of homebuyers wanting move-in ready homes rose by 10 percent and six percent more buyers were willing to take on longer commutes to get the home they want. In addition, low mortgage interest rates, combined with personal savings, are making conditions attractive for them to buy a larger home in a nicer neighborhood.
Yet, six percent fewer homebuyers planned to put more earnest money down, offer above listing price, or offer all cash. Only three percent planned to put down more than a 20 percent downpayment. Homebuyers want to simultaneously spend more for a home, but also plan to preserve as much cash as possible.
Homebuyers also plan to stay in their next homes for a longer period, so they want a happy, healthy idealized home.
Many of the attractions that make city living attractive, such as theater, shopping and dining out, simply weren’t available, causing some homebuyers to feel pent-up in their small apartments; they’re questioning if there isn’t a better way to live.
The result is a notable increase in home searches and purchases for single-family homes in smaller towns, exurbs and suburbs as many city-dwellers, particularly millennials, decide to ditch living in close quarters, paying high rents and home prices, and settling for views of buildings instead of landscapes.
One factor that’s driving the decision to move out of the city is that many white- collar workers believe they will continue to work from home permanently.
If you’re of like mind, what can you expect when you shop for a home in the ‘burbs? According to Realtor.com, a suburban home on average costs $230,000 compared to $431,000 home in the city with 300 more square feet of living space. You may still pay over list price or get into a bidding war, due to intensifying demand, but you’ll save a bundle in monthly payments. Small towns may offer even more savings as well as a slower easier-to-savor pace of life.