Real Estate and Travel & Tourism

Grand Rapids commute drives homebuyers

May 27, 2016
TAGS Redfin
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Redfin
Courtesy Redfin

A recent real estate report highlights that the average commute time in Grand Rapids is below the national average, which is a factor, along with the market’s relatively affordable homes, in attracting new residents and creating a housing "shortage."

Grand Rapids' average commute time of 21.6 minutes is below the national average of 25.7 minutes, and its average median home sale price is $153,000, while the national average is $263,000, according to a report posted yesterday by the residential real estate brokerage Redfin titled “Think your 25-minute commute is bad? These pricey cities have it worse?

The report is based on Redfin’s data on its markets and U.S. Census Bureau data.

Kent Selders, a Redfin real estate agent, says more clients are relocating from Chicago to Grand Rapids due in part to the lower commute time and lower cost of homes.

Chicago’s average median home sale price is $75,000 higher than Grand Rapids, and the average commute is eight minutes longer each way.

“They’re not moving because of a job. They’re moving with the prospect of better opportunities and a higher standard of living,” Selders says. “Many of my relocating clients have employment that is not geographically bound. They can work anywhere they have high-speed Internet.”

The example of Chicago and Grand Rapids is used in the report, which highlights how larger cities can’t absorb their popularity without causing longer commutes.

Those expensive cities are often larger cities, such as San Francisco and Chicago, and as residents become “fed up” with long commutes and other negative quality-of-life factors, they move to smaller, less expensive mid-sized cities — which the report says is why many Midwest markets are experiencing housing shortages, such as Grand Rapids.

For instance, Grand Rapids saw one of the sharpest declines in homes for sale, dropping 44.7 percent year over year in February, and builders are focusing on $250,000-plus houses, according to a March report by Redfin titled "Why can’t I find a house to buy in Omaha?"

Other reasons Midwest mid-sized cities are attractive: “Employment is good, prices are still affordable and the cities are big enough to offer meaningful cultural opportunities,” the report says.

But the surge in people and housing shortage could end up causing a problem.

“Without more homes, it will be hard to avoid escalating prices, exurban sprawl and longer commutes for residents,” the report says. “As these cities grow, plans should be made for increased density, increased demand on infrastructure and car-free transportation options.

“A refresh of local zoning laws to up density level would be a start, as well as incentives for homebuilders to build affordable prices in areas close to amenities. After all, no one in the Midwest wants to be accused of being the next San Francisco.”

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