Moving to Save? Depends on Where You’re Moving From and To

Key Highlights

• Moving remote tech workers may or may not save
• Must consider possible pay cuts and variable living costs in different locations

Both Coasts Perennially at Top of Lists for Both Net Outflows and Living Costs

The San Francisco Bay Area most always takes first place both for the highest living costs and the highest net outflows.  New York City isn’t far behind so it makes sense that when the pandemic essentially enabled people to move while embracing of remote work, coastal residents left for more affordable pastures and more space.

According to Redfin’s chief economist Daryl Fairweather, “The surge in remote work has enable many people who are able to work from home to relocate, usually to places with more affordable housing than tech hubs…the move typically pays off financially.  But, remote workers don’t always come out ahead when they leave expensive coastal cities, especially when they take a pay cut.”

Redfin’s Migration Affordability Tool Can Help Estimate Costs When Moving from One Metro to Another

https://www.redfin.com/news/migration-affordability-tool-disposable-income/

Redfin’s migration affordability tool is based upon data from the US Bureau of Labor Statistics Here’s a link to the Bureau’s information as well:

https://www.bls.gov/oes/current/oes_stru.htm

Agents, these sites are tools for you to help potential buyers who are considering relocating to your market area.  Let prospects know how much they could be saving if they moved to your area…likely they’ll be blown away with your knowledge and you’ll have a client rather than a prospect.

If Taking a -10% Pay Cut, Remote Tech Worker Moving from Seattle to Phoenix Would Break Even

Seattle, one of the country’s tech hubs and therefore filled with pandemic-inspired remote tech workers, is losing workers left and right to places like Phoenix, Portland and Spokane.  A typical tech worker moving from Seattle to Phoenix would have more disposable income in Phoenix ($83,000) than in Seattle ($73,000) assuming that tech worker earns the same amount of money in each place.

But, if that tech worker had  to take a 10% pay cut (as many companies are now imposing on their remote workers who consider moving) when moving from Seattle to Phoenix, that worker would only have about $600 more of disposable income per year in Phoenix.

Anyone can do these calculations just by using Redfin’s migration affordability tool.  Anyone can also do “comparative shopping” by comparing cost savings when moving from Seattle to Phoenix, or Seattle to Spokane, or Seattle to wherever.

Bottom line – remote tech workers wanting to save money and have more disposable income will ONLY do so by moving to more affordable places IF THEY DO NOT HAVE TO TAKE A PAY CUT FROM THEIR ORIGINAL SALARY.

Of course, potential buyers who are remote tech workers often have multiple reasons to move such as climate, more space, being closer to family, etc.  But if having more disposable income is the sole reason to more, help your prospects determine what’s best for them in the short- and the long-term with the same or with a -10% less salary.

Thanks to Redfin.

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