After months of predictions from experts about some types of markets booming while others died, and massive migration, real estate tech company OJO Labs has found that people just aren’t moving to dramatically different areas and looking for homes in the same markets they always have been.
Chris Heller | Photo credit: OJO Labs
“We have not seen people fundamentally move to different areas because of what’s going on,” Chris Heller, the chief real estate officer at OJO Labs, told Inman.
Data from Movoto, the real estate search portal owned and operated by OJO, found that the counties with the highest volume of search inquiries from March to September in 2019 were roughly the same from March to September in 2020.
The counties that did move slightly up the list in terms of search interest saw higher price increases than the ones that moved down the list, according to Movoto data, which was compiled and released as part of a new study, Tuesday.
While the same counties remain popular, where consumers are looking in those counties has changed slightly, with buyers looking at less dense parts of counties. Data showed that New Yorkers that are buying homes were initially averse to buying in denser urban areas like the Bronx or Queens, in the first month or two of lockdown, but that has mostly course-corrected.
What people are looking for in a home has also changed in some ways, but stayed the same in others, according to Heller. The typical consumer is still looking for a three-bedroom, two-bathroom home, with the number of rooms per search not increasing, despite work from home trends.
But people are also moving, Heller told Inman, and the data showed, because they want more outdoor space and things like pools, patios and bigger yards. The median preference for lot size grew by more than 700 square feet between January 2020 and September 2020, according to data from Movoto.
In many metro areas like Austin and Dallas, “backyard” was the number one search attribute added.
“People aren’t necessarily moving to dramatically different areas, but we do see people buying different homes,” Heller told Inman. “We do see that they’re making different decisions because they want outdoor space.”
How people shop for homes changed dramatically in 2020, and many of those trends of tech adoption are here to stay, according to Heller. Enhanced virtual tours have become more prevalent in every single market since March, according to the data.
In Austin, for example, the availability of virtual tours grew 147 percent between March 2020 and August 2020, and the use of enhanced virtual tours grew 1147 percent over the same period, according to data from OJO.
“You have a generation of people that have adopted technology now at a level that they never have before,” Heller said. “Once people become accustomed to that, become comfortable with that, they become habits, they don’t change.”
Heller believes that, once the pandemic has passed, people will still want to physically see homes and won’t be making purchases as frequently without stepping foot into the home. But with the availability of digital tools and better virtual touring technology, consumers will be able to visit fewer homes in person before making a decision.
“The amount of homes consumers are physically going to see has probably changed forever,” Heller said. “I don’t think that’s going to snap back. People will view more homes online.”
In terms of demand, Heller believes that the hot housing market will continue, despite macro uncertainty, as millennials age into homeownership. While secondary and vacation markets might not be able to continue to sustain demand, primary markets will be driven by demographic trends.
“We have the largest generation that is now fully engaged in the homebuying process,” Heller said. “You have this huge demographic of people that are coming into the time of their lives where they are buying and that’s not going to stop.”
“We’re early on in the process of that demographic group purchasing,” he added.
