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Homebuyers are leaving big cities for affordability—here’s where they’re going and how much they’re saving

It’s an age-old trend supercharged by the economic conditions of the COVID-19 pandemic: Homebuyers look to the suburbs for a home with enough space that also meets their budget.

American Home Shield looked at data from Freddie Mac to see which major metropolitan areas are experiencing an outflow of homebuyers, as well as where they are going and how much they could save on monthly mortgage payments. Metropolitan areas include the main city as well as its surrounding towns and suburbs.

Monthly mortgage payments were calculated using the median home price for that metro based on Freddie Mac loan applications over the past year. It assumes a 15% down payment and a 6% interest rate on a 30-year fixed-rate mortgage. It does not include the costs of property tax and insurance.

The analysis reveals that those able to purchase a home in the past year are fanning out from urban centers. Many affordable places people are moving to are in the same state but farther away from the city center. In many cases, homebuyers are moving to suburban areas and, in some cases, the exurbs beyond them.

And by doing so, they’re potentially saving a considerable amount of money.

Based on the weighted average of median home prices, the typical mortgage payment is about $3,000 in the top 20 urban metro areas. People who move from these places to more affordable alternatives save about $600 on average.

Big cities lost their appeal over the last five or so years, and the invisible threat that was the pandemic gave homebuyers only more reasons to seek out less dense spaces. Now that home prices are roughly 43.3% higher on average than in 2019, the price differential in these areas continues to appeal to buyers looking to stretch out their dollars.

Continue reading to see where homebuyers in the top 20 metros are heading.

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#20. Charlotte, North Carolina

– Estimated mortgage payment: $2,100
– Top affordable destination: Hickory, North Carolina ($1,300 estimated mortgage payment)
– Monthly savings: $800

Charlotte is the most populous city in North Carolina and is quickly becoming unaffordable for many of its residents. To the northwest, in the foothills of the Blue Ridge Mountains, Hickory offers a walkable historic downtown and a similar Southern setting to Charlotte.

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#19. Sacramento, California

– Estimated mortgage payment: $3,000
– Top affordable destination: Yuba City, California ($2,400 estimated mortgage payment)
– Monthly savings: $600

Many Sacramento homebuyers have their eyes set on suburban Yuba City as they look to trade high costs of living for a city where most residents can afford to own their homes. Sacramento politicians are facing pushback as they attempt to add homeless shelters.

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#18. Portland, Oregon

– Estimated mortgage payment: $2,700
– Top affordable destination: Salem, Oregon ($2,300 estimated mortgage payment)
– Monthly savings: $400

Oregon is becoming pricier than ever. A new report from United Ways of the Pacific Northwest and United for ALICE found that almost half of the households in the state don’t make enough money to cover basic bills. For Portland residents looking to buy a home, Salem may intrigue them due to its relatively average cost of living compared with the rest of the U.S., according to U.S. News & World Report.

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#17. Detroit

– Estimated mortgage payment: $1,500
– Top affordable destination: Flint, Michigan ($1,000 estimated mortgage payment)
– Monthly savings: $500

Detroit, home of the U.S. automobile industry, has not historically had a high cost of living compared with other parts of the country. However, record inflation has not spared any part of the U.S., nor any individual income demographic, and it is giving households reason to eye homes for purchase in Flint.

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#16. Tampa, Florida

– Estimated mortgage payment: $2,000
– Top affordable destination: Lakeland, Florida ($1,700 estimated mortgage payment)
– Monthly savings: $300

The Tampa metro has been a frequent target of hurricanes that make their way across the Gulf of Mexico, including Hurricane Ian, which ripped apart Fort Myers Beach to the south. Lakeland is roughly 30 miles inland and east of Tampa and may offer homeowners more protection from bad weather.

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#15. Austin, Texas

– Estimated mortgage payment: $2,600
– Top affordable destination: San Antonio, Texas ($1,700 estimated mortgage payment)
– Monthly savings: $900

Austin, the San Francisco of the South, is going through growing pains as housing stock falls short of demand and prices have skyrocketed to unaffordable levels. San Antonio offers an appealing alternative for homebuyers who love the hill country and its lakes and rivers, and the city is only 1.5 hours away from the state capital.

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#14. Orlando, Florida

– Estimated mortgage payment: $2,100
– Top affordable destination: Lakeland, Florida ($1,700 estimated mortgage payment)
– Monthly savings: $400

Lakeland is a hot spot for Florida homebuyers looking for affordable alternatives to the big metros, pulling buyers from both Orlando and Tampa. Lakeland is near a number of attractions like Disney World and the beaches along the Gulf Coast.

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#13. San Diego

– Estimated mortgage payment: $3,800
– Top affordable destination: Riverside, California ($2,900 estimated mortgage payment)
– Monthly savings: $900

The so-called Inland Empire, centered on San Bernardino and Riverside, has been luring millennials looking for affordable housing for at least the past decade—a trend that only intensified with the pandemic’s effects on the cost of living in Los Angeles County.

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#12. San Jose, California

– Estimated mortgage payment: $4,700
– Top affordable destination: San Francisco, California ($4,200 estimated mortgage payment)
– Monthly savings: $500

California home prices may feel like a totally different ball game for much of the country, but high-earning San Jose homeowners are cashing in and moving into San Francisco, which is nearly equally as expensive. San Francisco has experienced slower housing growth than comparable cities—including Austin, Texas, and Seattle—over the past decade due to permitting fewer new builds, according to a San Francisco Chronicle analysis published in 2022.

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#11. Phoenix

– Estimated mortgage payment: $2,400
– Top affordable destination: Prescott Valley, Arizona ($2,200 estimated mortgage payment)
– Monthly savings: $200

Phoenicians are trading their valley for more mountainous landscapes about 1.5 hours north. Prescott Valley has a proud Western ethos that sees more winter weather than Phoenix. Phoenix housing costs saw one of the largest jumps nationally in recent years, fueled partly by deep-pocketed investors who bought starter properties to make into rental units over the pandemic.

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#10. Atlanta

– Estimated mortgage payment: $2,100
– Top affordable destination: Gainesville, Georgia ($2,000 estimated mortgage payment)
– Monthly savings: $100

Gainesville is a hub for poultry farming and, according to the 2020 census, home to 42,000 people, making it just a fraction of the size of nearby Atlanta, which boasts a population of nearly half a million. A shortage of home inventory in Atlanta is suppressing the market there and continuing to put upward pressure on home values.

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#9. Dallas

– Estimated mortgage payment: $2,300
– Top affordable destination: Houston, Texas ($1,900 estimated mortgage payment)
– Monthly savings: $400

Houston, we have a problem—those hoity-toity Dallasites are being priced out of Dallas-Fort Worth and want lower costs of living. And they may be finding it in sprawling Houston, another of the most populous metro areas in the entire country. Houston offers a low cost of living to the DFW metro, and builders in the region are actively adding home inventory that could help bring prices down in the near future.

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#8. Denver

– Estimated mortgage payment: $2,900
– Top affordable destination: Greeley, Colorado ($2,600 estimated mortgage payment)
– Monthly savings: $300

In Denver, homebuyers are looking to Greeley, home of the University of Northern Colorado, to reclaim a few hundred dollars of their housing costs each month. Home costs in the Denver metro have skyrocketed due to a shortage of inventory in recent years—much like the rest of the country.

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#7. Seattle

– Estimated mortgage payment: $3,400
– Top affordable destination: Phoenix, Arizona ($2,400 estimated mortgage payment)
– Monthly savings: $1,000

Seattleites are fleeing Big Tech’s backyard in the Pacific Northwest for dry and sunny Phoenix. And even putting Seattle housing costs aside, it’s no wonder—a recent regional economic study found the cost of just about everything in Seattle is more expensive than the U.S. average.

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#6. Miami

– Estimated mortgage payment: $2,200
– Top affordable destination: Port St. Lucie, Florida ($2,000 estimated mortgage payment)
– Monthly savings: $200

Port St. Lucie has experienced massive population growth in recent years, now ranking just behind major cities like Miami, Tampa, and Orlando. In the face of that growth, the city is currently trying to rediscover its identity and what sets it apart amid a throng of Florida population centers with world-renowned tourist-driven economies.

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#5. Boston

– Estimated mortgage payment: $3,000
– Top affordable destination: Worcester, Massachusetts ($2,100 estimated mortgage payment)
– Monthly savings: $900

Massachusetts homebuyers pay the fifth-highest down payments in the country on average, and the state is dealing with its own shortage of housing inventory—especially the kind that middle- and low-income residents can afford. Worcester, which has seen its population grow by roughly 21,000 over the last decade, is the second most populous city in the state and is located just west of Boston.

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#4. San Francisco

– Estimated mortgage payment: $4,200
– Top affordable destination: Sacramento, California ($3,000 estimated mortgage payment)
– Monthly savings: $1,200

Like many other business centers, San Francisco, the gateway to the Pacific, is currently undergoing a post-pandemic shift in culture as offices sit vacant. Retailers and other businesses have begun to exit the city, citing a rise in shoplifting. Homebuyers are finding a booming arts scene, a wide array of festivals, and lower housing costs in nearby Sacramento.

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#3. Washington DC

– Estimated mortgage payment: $2,700
– Top affordable destination: Baltimore, Maryland ($1,900 estimated mortgage payment)
– Monthly savings: $800

Baltimore’s median home prices dropped for the first time in years this spring, and the city has lost residents in recent years. The downtown has also been plagued by blight due to historic disinvestment in Black communities that have inhabited its characteristic rowhomes. But the market is offering Washington D.C. residents, who pay among the most in the country for housing, the opportunity to trade down their housing costs.

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#2. Los Angeles

– Estimated mortgage payment: $3,800
– Top affordable destination: Riverside, California ($2,900 estimated mortgage payment)
– Monthly savings: $900

Like those in San Diego, Los Angelenos continue to be swayed by the promise of an easier cost of living in the Inland Empire, which comprises Riverside and San Bernardino. Riverside, in particular, is where children can attend above-average schools compared with the rest of the state, and most residents there can afford to own their homes, according to Niche.

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#1. New York

– Estimated mortgage payment: $2,900
– Top affordable destination: Philadelphia, Pennsylvania ($1,900 estimated mortgage payment)
– Monthly savings: $1,000

One of the greatest towns for professional sports fans, Philadelphia is pulling the attention of New York homebuyers seeking to lower their monthly mortgage payments. Philly offers a reprieve for a buyer who could drop $1.5 million for property in the New York City borough of Staten Island, even if it still has relatively high housing prices.

Data reporting by Elena Cox. Story editing by Jeff Inglis. Copy editing by Andrew Mangan. Photo selection by Elizabeth Ciano.

This story originally appeared on American Home Shield and was produced and
distributed in partnership with Stacker Studio.