A neighborhood along Lake Washington in Seattle. A fall day in the Pacific Northwest.
Home prices in the Seattle metro area mirror a new trend now apparent in many of the nation’s largest metros: homes in the heart of the city are appreciating at a slower rate than homes located away from downtown.
Seattle homes that have gained the most value over the last two years are ones 51 to 60 minutes away from downtown, according to a new study authored by Zillow. The value of those homes has risen by an average of 39.5% since 2019, the study said. Comparatively, the value of homes located in downtown Seattle and up to 10 minutes away have only risen by an average of 12.2%.
An economic data analyst with Zillow, Nicole Bachaud said homebuyers are placing less of a premium on short commute times given the rise of remote work during the pandemic.
“Americans are searching for a combination of affordability and more space, whether that’s outdoor space or an extra bedroom to turn into a home office,” Bachaud said in a news release about the study. “In expensive, dense markets, that usually means a home farther out from the downtown core, which is more palatable when you don’t need to commute every day, if at all.”
This chart shows how, since 2019, the value of homes away from downtown Seattle are growing at a faster rate than homes in downtown Seattle.
The study found similar trends in other large metros throughout the U.S, including New York City, San Francisco, Boston, Chicago and Dallas. For example, a home with a 10-minute commute to work in New York City is, on average, $73,673 cheaper than it was in 2019, the study said. A home in Boston with the same commute is $21,175 cheaper.
However, the study points out that the reverse is happening in some large metros. In places such as Cleveland, Detroit, Baltimore and Indianapolis, home values are trending up near downtown. A home within a 10-minute commute of downtown Detroit is now $101,228 more expensive than it was in 2019, and the price of living within a 10-minute commute of downtown Indianapolis has grown $54,025 over the same period, the study said.
“While these two forces seem to be in opposition, they are really two sides of the same coin: Americans are seeking larger, more affordable homes as flexible work opportunities bring new expectations for what they want and need in a home,” the Zillow report said. “As people seek affordability, they are willing to live with a longer commute if they can save on housing costs. And less expensive downtown cores are gaining in popularity relative to the pricier suburbs nearby.”