Real estate has long been tied to job growth. In the past decade, home prices have surged in the urban cores of hot labor markets, as more and more people were drawn to live near the abundance of high-paying jobs in big cities like San Francisco, New York, and Boston. But what happens when good jobs no longer have a fixed location?
We may soon find out. Before the COVID-19 pandemic forced nonessential employees to work from home, only 8 percent of Americans were telecommuting at least once a week, according to the US Bureau of Labor Statistics. But like power windows and door locks, what used to be a perk may soon become standard.
In Boston, 26.6 percent of employees who didn’t have the option of remote work before the shutdown now anticipate telecommuting at least part time going forward, according to a survey by national brokerage Redfin. If even some of those workers have to commute into Boston only a few times a week, it could boost home sales in rural or exurban communities from Cape Cod to New Hampshire, said Redfin lead economist Taylor Marr. “There will be a lot more people who are comfortable spending their three-day weekend at a vacation home or buying a suburban home that’s much further away,’’ Marr said.
Coupled with concerns over crowded quarters in the age of COVID-19 — Marr said searches for single-family homes have increased relative to condos — agents in popular New England vacation destinations are seeing strong buyer demand, despite an overall slowdown in home sales and staggering unemployment.
“We have a ton of buyer activity,’’ said Adam Dow, owner/broker at Dow Realty Group in Wolfeboro, N.H., on Lake Winnipesaukee. Dow said the demand is driven by a few different motivations.
“We’ve got people who have been kind of looking for two or three years who are realizing that if they had made the purchase, they would have had a really great place to quarantine,’’ Dow said. These types of buyers are now “super serious about finding something,’’ he added. Others are confronting the fact that their normal summer leisure plans — whether it’s traveling to Europe or sending the kids to summer camp — are less likely to materialize this year. As a result, Dow said, they’re looking at places they can enjoy closer to home.
Still others, encouraged by the flexibility of telecommuting, are now considering making a vacation home their primary residence. One of Dow’s agents worked with a couple who was initially seeking a ski vacation home near Loon Mountain in Lincoln, N.H. “And they switched their criteria to find something with acreage and make it their primary residence, because they’re both in tech and can now work at home,’’ Dow said.
An April IBM survey of more than 25,000 adults indicated that, after this sudden and widespread experiment in telework, 75 percent of employees would like to continue working from home at least some of the time, and more than half want the option to telecommute full time. And some corporate executives are on board. Nearly three-quarters of the chief financial officers surveyed by Gartner, a consulting firm, said they expect to change some previously on-site jobs to remote roles permanently after the pandemic has lifted.
Not every job can be done remotely, of course. But in a new white paper, University of Chicago researchers estimate that 44 percent of Boston-area jobs — many in the education, technology, and financial sectors — could be performed entirely at home, compared with 37 percent nationally.
It’s a trend that Sara Holland, owner/broker at Sara Holland & Co. in Plymouth, N.H., has seen accelerating in recent years. Holland said many of her clients have been Boston-based buyers who purchased a second home intending to live there full time eventually. “And when they made that transition from vacation home to primary home, they were commuting [to the Boston area] one or two days a week,’’ she said.
Others aren’t looking for such a gradual transition. The combination of a fast-spreading virus and the prospect of increased work flexibility has pushed some buyers to act with more urgency. “We got immediate phone calls after the lockdown with folks saying: You know, we’ve always been on the fence about getting a second home, we’re just going to move. We’re done, we’re getting out of the urban area,’’ Holland said.
A May Redfin study found huge spikes in search interest for homes in small towns and rural areas during the shutdown. Some of that could be chalked up to urbanites dreaming of escaping the city and finding a safe retreat, Marr said. “[But] searches for small towns and vacation spots and rural areas remain quite high, at nearly double the rate of a year ago,’’ he added.
Glenn Phillips, chief executive of Lake Homes Realty, said that after a dip in March and early April, traffic to the lakefront property site was up more than 50 percent in May year over year — and it wasn’t just daydreamers. “The fear was our traffic was just a bunch of bored people,’’ Phillips said. “We’re not seeing that; we’re having really good contract flow. It’s comparable to what we were doing last year, or even a little ahead of last year at this time.’’
Buyer interest is strong on the Cape and Islands as well, because while sales dropped off significantly in April, new listings slowed even more, said Greg Kiely, president of the Cape Cod & Islands Association of Realtors. “So there were still more pending sales each week than houses to replace them,’’ Kiely said, leaving buyers with very little to choose from — and compete for.
“Our inventory is at historic low levels,’’ echoed the association’s chief executive, Ryan Castle. “The thing about Cape real estate is we don’t really produce any new housing.’’
And against the backdrop of a pandemic that has claimed more than 110,000 Americans, people have been awakening to the fact that life is short. “People are reassessing — what does this mean for my life?’’ Kiely said. “And we, along with some communities along the New Hampshire Seacoast and I’d imagine out in the Berkshires, are probably going to benefit from that in a lot of ways, because we’re accessible and many people do commute — if not every day, some days a week or part time — from the Cape into the city of Boston or the immediate Boston suburbs.’’
Communities just over the bridge, such as Sandwich, Bourne, and West Barnstable, already have many households where at least one person commutes off-Cape for work, Kiely said. But a shift toward telecommuting could open up opportunities for towns farther down Cape.
“We’ve shown over the past few weeks that we are a really strong, viable option, that people can work from here,’’ Kiely said, noting the influx of vacation home owners and long-term renters who sought refuge there this spring. “And when under a moment of great stress and uncertainty, people are choosing to come here.’’
What’s more, a widespread increase in telecommuting could make the trip more bearable when people do venture into town. Traffic volume along the Massachusetts Turnpike in Boston was down 74 percent in early April compared with the same week a year earlier, according to data the Department of Transportation collected at highway checkpoints. We may never see the Pike that empty again. But Marr noted that, while urban planners have been struggling for decades to improve public transit and expand highways so workers can access more affordable housing farther away, a telework revolution may accomplish the same goal with a lot less digging.
“This might be a new innovation with regards to the urban landscape — more flexible, remote options that sort of serve as a transportation innovation in an odd way,’’ Marr said. “We haven’t made much progress in terms of making trains or highways any faster lately, especially in areas like Boston or New York, but if we allow people to just take them less frequently, by having more flexible remote options, that’s also kind of a game changer.’’
Actually, there might be some digging required. Holland said her Boston-based buyers all ask one question: What’s the Internet service like? “And in some of our areas, we don’t have great Internet service. That’s something we’ve struggled with from central New Hampshire north in certain parts, so that’s definitely a concern for folks.’’
But even if telecommuting becomes commonplace, Marr doesn’t expect a wholesale exodus from the Boston area, noting that about 15 percent of Boston-area residents reported working from home full time before the pandemic hit — and they still live here. “People have houses and family and schools and community and other ties to certain urban areas,’’ he said. “Even if they were able to work full time remote, they’re probably not going to all pick up and leave Boston.’’
Dow, though, wondered what’s to stop them. “If people are living in an area where the most important thing is getting into the city for work and that requirement is lifted, then where are they going to go?’’ he asked.
After seeing people flee to the Cape in March, Castle had an idea. “What I’ve been saying is this: Where you want to be during a pandemic is where you should be year-round.’’