The COVID-19 pandemic brought significant changes to work routines and subsequently the housing market, as quarantine mandates required Americans to work from home. However, the mass return to office—or at least hybrid work—has seen new trends emerge. As we continue to navigate the aftermath of the pandemic, analyzing the impact of lifestyle changes induced by the rise and fall of remote work remains crucial.
The Effects of the Pandemic
As remote workers grew tired of living and working in cramped apartment spaces in expensive cities, many moved from crowded cities to more spacious, cheaper areas. Demand for housing in low-density suburban locations surged, as well as in rural areas and small towns. Their higher home prices and property values contrasted with the decreases seen in metropolitan areas. (Overall, though, home prices saw a significant increase due to the pandemic.)
Growing communities of remote workers, like Bellevue, Washington and Fremont, California, became known as “Zoom towns.” Because workers were no longer bound to live in certain locations for their job, many of these areas became popular for their proximity to major cities and access to urban amenities while still maintaining lower housing costs and offering more space.
Return to the Office
As many workplaces continue requiring their employees to return to in-office or hybrid work, workers who moved away from their work are faced with a dilemma to either lose their job or relocate closer to their office—which is often more costly, considering increased mortgage rates as a result of the pandemic.
A survey Redfin conducted in 2023 found that 10.1% of people likely to sell their home and move in the next year were motivated by return-to-office mandates. Thus, the post-pandemic market has seen a rise in more workers returning to job centers in urban areas. Some of the most impacted cities are major industry hubs, including New York City, San Francisco, and Seattle.
These cities heavily affected by post-pandemic population growth have seen an increase in home prices and property values. The rental market has also been impacted, with rental costs rising and rental vacancies decreasing. Even higher than 2017-2021 percentages ranging from 12-13%, urban homes made up 15.84% of the location of homes purchased in 2024, contrasted with 9.9% in 2022.
As residents move away and demand decreases, suburban and rural locations have seen the converse effect on their markets. In particular, rural areas made up 12-13% of home purchases pre-pandemic, with small towns at 20-21%, then saw respective increases at 18.8% and 28.7% in 2022. However, 2024 sees rural areas drop back to 13.7% and small towns to 22.7%.
General Implications
Though employment opportunities have always been a significant reason for relocation, these pandemic-induced changes to the housing market reinforce how heavily the workplace can influence housing decisions.
However, especially for hybrid workers who can afford balancing lifestyle and commute, the pandemic also led to new preferences for homebuyers. Many homeowners are now interested in how their homes can enhance their wellbeing, having seen the effect of quarantine on mental health. Outdoor spaces, such as patios and porches, and general access to nature have become more significant priorities to boost happiness. Homebuyers still continue to flock to suburban areas for proximity to major urban centers, especially if necessary to commute for work, balanced with spacious homes and quieter living.
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