More Buyers Turn To Exurbs

With more companies offering extended remote-working options for their employees, home buyers are pushing out farther and wider into once-rural exurbs far from city centers.

TENNESSEE

The exurbs around Nashville have been particularly busy since March 2020.

“We’re seeing the biggest growth in exurbs in Williamson County,” consistently ranked among the 20 wealthiest counties in the U.S., says Jenny Telwar, managing broker, Zeitlin Sotheby’s International Realty based in Nashville. “It’s one of our most active markets.”

“This is where we’ve seen our craziest market—the houses selling in a day or a weekend with 30 offers, the US$200,000 over-asking bids, and buyers waiving everything under the sun,” she says. “It’s like a faucet was turned on, and it’s never stopped gushing.”

Williamson County, which is 30 to 40 minutes from downtown Nashville, “has always had demand, but we’ve never seen a market like we’ve had in 2021.”

One recent buyer closed on a new-construction home in April 2021 for US$1.6 million and turned around and sold it in a day for US$2 million in July.

Nashville has seen a steady stream of national companies looking for an expanded presence in the city, she says. “Most of the buyers I’ve worked with are from New York, Chicago, San Francisco, San Diego, and throughout New Jersey. We expect to see even more.”

Tennessee’s Trousdale County is another high-performing Nashville exurb. Prices there rose 17% from January 2020 to August 2021, Telwar says, and pending sales in Hartsdale, the county seat, shot up 63% in the same period.

Trousdale, which is about 90 minutes from downtown Nashville, “isn’t a commuter pocket,” she says. “It’s more retirees who want to be close to good health care.”

Other Nashville exurbs with strong recent sales include the Tennessee cities of Columbia, Franklin, and Murfreesboro. From January 2020 through August 2021, pending sales rose 23% in Murfreesboro and 50% in Columbia, “which is a rural, rural area,” Telwar says.

She expects 2022 to be another strong year. “The buyer drive is still very, very strong,” she says. “People love Tennessee—the low taxes, the green spaces, the slower pace.”

Plus, there’s a lot of land still to be developed. “The entire Middle Tennessee corridor has a ton of potential. We’re optimistic.”

TEXAS

The greater Austin, Texas, market has also been thriving. Since the suburban market is so competitive, people have been moving further afield, says J Kuper, a third-generation agent and broker/owner, Kuper Sotheby’s International Realty.

Exurbs around Austin that are doing quite well include Lakeway, “which has been hot for some time;” Dripping Springs, which is due west of Austin; and Cedar Park, which is due north, he says.

Not long ago, the Dripping Springs and Cedar Park markets were both considered “very small subsets” of the outlying area, but “now they are borderline considered part of the Austin market,” Kuper says.

New builds have been big in Cedar Park, Kuper says, driving up prices. And residents of Dripping Springs feel like they live in a small town, but are still very much connected to Austin, he says.

For the greater Austin market, sales are up almost 15% compared with September 2020, and “that was a record-setting month then,” he says. Year to date, sales are up almost 21%, and the average price is up almost 25%.

Like Nashville, many corporations have moved to Austin in recent years, he says. “Their workforce is completely happy to be part of the greater Austin community. They are OK with living 30 or 45 minutes from town and being a commuter,” he says.

NEW YORK

In New York’s Hudson Valley, the center of which is about 100 miles north of Manhattan, New York City residents eager for office and outdoor space have flooded the market.

“It hasn’t really slowed down,” says Raj Kumar, agent, Four Seasons Sotheby’s International Realty who works primarily in Columbia, Dutchess, Ulster, and Greene counties. “Our team is seeing bigger- and bigger-ticket buyers. It’s a strong and steady market now. The frenzy that we saw during Covid is no longer there.”

The company had record-breaking sales in a few Hudson Valley communities this year, including a US$1.1 million sale in Greenville and a US$2.2 million sale in Barryville.

Last year, he had a US$3 million sale on the city of Hudson’s Warren Street, its main thoroughfare, a record for the street.

In May, Columbia/northern Dutchess and Greene counties saw a 37% year-over-year increase in median price, he says. Other communities with a lot of traction include Germantown, Rhinebeck, Red Hook, Ghent, Kerhonkson, Millbrook, and Chatham, says Kumar, who lives in Hudson.

Most of Kumar’s buyers are New York City residents looking for a second home, “but we’re seeing more first-home buyers,” he says.

Someone looking for a property in the US$600,000-to-US$700,000 range “used to be considered a good buyer,” Kumar says. “Now that buyer is looking in the US$1.5 million–to–US$2.5 million range.”

Kumar predicts “a strong market for many years to come…Land is still inexpensive and plentiful.”

FLORIDA

The exurban markets that ring Orlando, Florida, have also been hot.

“What you get for your money here is unbelievable, and the other story is our low taxes,” says Carrie Prieto, managing broker for four Premier Sotheby’s International Realty offices in central Florida.

Californians and Midwesterners have joined the traditional buyers from the Northeast.

In Ocala, which is about 65 miles north of Orlando, the average price in August 2021 was up 46% year over year, and active inventory was down 32%, she says. New construction is booming, with 7,000 permits for new construction backlogged in the Ocala Building Division.

“The prices are lower than Orlando, and people are okay with the one-hour drive to the city,” Prieto says.

On the west side of Orlando, “Lake County has seen tremendous growth,” she says. Average prices are up 24%, with active inventory down 34%.

The Clermont area of Lake County has become very popular over the last 10 to 12 years, she says. “It was all country there previously.”

In exurban Orange County, the Horizon West master-planned community is bringing more than 40,000 residential units (mostly single-family and townhomes), Prieto says. “The schools have had trouble keeping up,” she says.

In Osceola County, south of Orlando, “St. Cloud was a small, sleepy city until the last four or five years,” she says. “Now there are big land sales and a lot of communities being planned, with big national building companies coming in.”