It’s not exactly news that strong buyer demand and a limited inventory of available homes for sale have caused home prices to skyrocket and forced many would-be buyers out of the local purchase market. But an April report by Seattle-based brokerage Redfin found that a record 32.3 percent of its users nationwide were looking to relocate to a different metropolitan area in the first quarter, driven largely by rising home prices and mortgage rates, which have made moving to a more affordable area the only option for many prospective buyers.
“Home affordability, inflation, remote work, and the tight labor market are all driving people out of expensive metros like Boston,” said Daryl Fairweather, Redfin’s chief economist. “Many people are seeing their disposable income fall because of inflation and are realizing they can have more disposable income by moving somewhere with a lower cost of living.”
The Redfin study is based on a sample of about two million users who searched for homes across more than 100 metro areas during the first quarter. It found that 14,173 Boston residents left the market in the first quarter of 2022, up from 4,661 a year earlier. Their top destination: Portland, Maine.
“Portland is close enough to Boston that movers can still drive into Boston for the occasional Red Sox game or business meeting,” said Fairweather. “It’s also much more affordable than Boston.”
According to the Greater Boston Association of Realtors, the median sales price of a single-family home in Greater Boston hit a record high in March — $789,500, up 9.4 percent from one year earlier. The median price of a condominium rose as well, to $675,000, a gain of 9.4 percent year over year.
Still, demand for homes in Greater Boston remains so strong that bidding wars are common. Doreen Lewis, principal agent for Redfin in Canton, worked with a buyer client recently who offered $50,000 over the asking price and waived inspections, the mortgage contingency, and the appraisal gap clause — and still didn’t get the house. She said her clients are getting frustrated.
“I give them all the facts so they go in with their eyes wide open,” Lewis said. “I want them to know upfront they’re probably going to get their hearts broken.”
Lewis said many of her clients are considering communities in Central Massachusetts, increasing their down payments, and getting help from parents to afford a home. Others are looking to leave the state.
“Portland has a lot of attractions,” she said. “You’re still on the water, and it has a fantastic downtown. I can see the appeal.”
More important, Lewis said, while a three-bedroom home on the outskirts of Boston might cost about $600,000, the same home in Portland might be $400,000.
“About 80 percent of our business last year was working with Massachusetts residents priced out of the Boston market, so that’s a huge portion of our clientele,” said Jasmine Pellerin, a real estate broker with Keller Williams Realty Maine in Portland.
“Portland is a charming coastal Maine town,” Pellerin said. “It has a great food scene, art scene, and music scene, and people want to be in an area that isn’t so populated. The quality of life here is fabulous.”