Richmond's growth in home values was eclipsed only by Miami - reflecting a shift in America's values

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It's no surprise that Miami's real estate market has grown the fastest in the country since last year (10.49% increase since February 2022). With its sunshine, beaches, and urban amenities, Miami real estate is always in demand.

What's more surprising are some of the other cities in the top 10. When Zillow released its home value index for February 2023, cities like Oklahoma City, OK, and Kansas City, MO made it into the top 10. And number two, right behind Miami?

Richmond, Virginia.

Since February 2022, home prices in Virginia have grown by 7.43%, a half percentage point ahead of its next competitor.

That means one thing - the Richmond real estate market is white hot.

Why does everyone want to move to Richmond?

Richmond's popularity is part of a larger migration taking place in America. Those in metropolises are moving to mid-sized cities while residents of mid-sized cities are considering smaller towns.

There are two reasons for this. To begin with, the pandemic enabled many more people to work remotely full-time, which gives knowledge workers a freedom they've never had before - to choose where they want to live.

Suddenly, people are able to work for large corporations and still consider the lifestyle they want to have. And many are opting to live in smaller centers because they are often safer, slower-paced, and more convenient. No more commutes, easier access to nature, etc.

The other reason is inflation. With the cost of living increasing and mortgage rates high, people are seeing that living in smaller cities enables their money to go further. The real estate markets of smaller cities tend to be more affordable than urban centers. If you can sell your home for more money than it would take to buy a larger home someplace else, that's a considerable financial advantage.

Okay, so why Richmond?

Richmond represents what many people are looking for from a lifestyle perspective. It's a city that is reasonably mild but still experiences four seasons. It's got a good job market and plenty of amenities. There's easy access to beautiful lakes and hiking and bike trails. The good life.

Richmond is also fairly centrally located, providing easy access to Washington and many of the east coast's largest cities.

But perhaps its biggest selling point is the cost of living. The median home price is still under $200K while the median rent is $916 - much lower than where people are moving from.

Richmond's population has already increased 10% since 2010, and given its popularity, locals can expect that to increase exponentially over the next 10 years. Is that good news, or a potential concern? Only time will tell.