Proximity to work and/or public transportation used to be two top reasons for home selection. But after a year where many worked from home, how did those standard factors affect home prices?
According to Redfin, home prices in historically car-dependent neighborhoods (like suburban and rural areas) rose twice as fast during the pandemic when compared to public-transit friendly markets (such as proper cities).
The median home-sale price in car-dependent areas nationwide has increased 32.8 percent to a record $418,100 since January 2020, while transit-friendly neighborhoods rose 15.6 percent to a record $540,500.
Another impact of the pandemic and the remote work that followed was that homes in car-dependent neighborhoods are now more competitive than those in transit-accessible neighborhoods. Some 56 percent of homes in suburban and rural neighborhoods sold for above asking price in May, compared to 36 percent of transit-accessible homes. Those homes also sold faster: on the market for just 19 days compared to 38 days in more urban centers.
“Remote work has allowed many homebuyers to leave cities for far-flung suburbs. Those suburbs often lack public transit, so new residents drive more often,” said Redfin Chief Economist Daryl Fairweather. “Hopefully, a less frequent commute will mean fewer hours behind the wheel. But as offices reopen, we may see commuters who used to live in the city and use public transit spending more time driving and emitting more carbon. Governments need to plan for this new reality and start providing more green transit to areas outside of major cities.”