Renters nationwide are increasingly looking beyond their local areas for housing, with Buffalo and Houston emerging as primary destinations, according to new data from Zillow. This trend suggests a reshuffling of urban desirability, as high for-sale home prices continue to push potential buyers back into the rental market.
Buffalo and Houston, along with Chicago, New Orleans, and Dallas, are experiencing notable increases in out-of-town rental searches. In some markets, such as Salt Lake City, Raleigh, Hartford, and Nashville, external renters already outnumber local searchers, indicating that earlier migration waves have matured into substantial demand.
Zillow's chief economist, Mischa Fisher, explained that rental searches often precede home purchases, serving as a preliminary exploration of a new community. "When we see a market with a growing share of rental searches coming from outside the metro, that tips us off to a developing pipeline," Fisher said in a report. "A year-over-year surge in out-of-town browsing in places like Buffalo and Chicago tells us a wave of newcomers may not be far behind."
Buffalo presents a compelling case study in affordability. The average home value in the city is approximately $249,040, a fraction of the national median for existing homes, which stood at $434,100 in July. Despite a 104% price increase since the start of the pandemic, Buffalo remains one of the more accessible markets in the Northeast, attracting renters looking to test the waters before buying.
Houston's appeal is driven by a combination of factors, including job growth and relative affordability. The metro area's median sale price was $360,000 in the three months ending in July, with average home values around $260,000. The city's economy has seen significant job additions across sectors like energy, construction, manufacturing, and healthcare. Relocation buyers, particularly from expensive coastal states like California, New York, and Illinois, are increasingly viewing Houston as a viable option, with rental searches indicating a trial period for many.
Chicago, while not as inexpensive as Buffalo or Houston, is still more affordable than coastal cities. Its average home value is $315,024, with metro-wide median sale prices ranging from the mid-$300,000s to $425,000. Chicago has also shown strong price growth, suggesting that incoming renters are arriving in a market already gaining momentum.
The broader rental market is also showing signs of recovery, with August marking the first month-over-month increase in four years, though prices remain slightly below the previous year's levels.
New York City renters exhibit a different pattern, with a notable interest in southern cities like Raleigh, Miami, Orlando, and Tampa, bypassing many nearby states. Fisher noted that strong out-of-town interest in smaller markets often points to affordability advantages, while migration into major metros is frequently driven by regional job opportunities.
Southern cities continue to attract residents, with 37 of the top 50 spots in RentCafe's "Best Cities for Renters" ranking going to cities in the region, including McKinney, Texas; Huntsville, Alabama; and Austin, Texas. This sustained migration highlights the ongoing appeal of these areas based on both financial considerations and lifestyle factors.