In 2021, people moved to homes in affordable areas with good weather and plentiful outdoor activities. This migration led to a significant increase in home prices for states in two distinct regions.
The COVID-19 pandemic accelerated the pace at which people migrated from large cities. According to Freddie Mac research, as of fall 2021, migration from the top 25 largest cities was three-times more than the pre-pandemic rate.
Flexible remote work arrangements, a desire for more space and a cheaper cost of living encouraged many people — especially those living in large cities — to reevaluate their living situations.
Of those who took the next step and moved, most relocated to small and midsized cities, with populations ranging from 500,000 to 1 million people.
As it happens, the majority of these cities are located in the South and Mountain West, where outdoor amenities are abundant and the cost of living is more affordable — or at least it was.
In 2021, the average home price in Western and Southern states increased considerably compared to other areas of the country. And this trend is likely to continue. We forecast that remote workers and retirees moving to more affordable areas will keep home prices growing because many of these buyers have the means to afford higher prices.
States Where Home Prices Increased Most
Here are the 10 states where home prices increased the most in 2021.
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