Americans who bought large rural homes during COVID are now selling up and returning to cities as more employers end work from home rules

Americans who bought large rural homes during the pandemic are now selling up and returning to the cities as companies ax work from home rules.

When COVID hit in 2020, over 61 percent of people worked from home - which led homeowners to opt for larger homes with more space to live and work in.

Return-to-work policies are motivating one of every 10 U.S. home sellers to relocate, according to a housing survey collected by Redfin from May and June 2023.

More companies are implementing return-to-office orders and workers are facing the decision to sell their spacious suburban and rural homes and get back in the office or keep their pandemic lifestyle and find a new job.

Major companies such as JPMorgan, GEICO and HSBC have ordered their staff back into the office at least a few days a week after allowing their staff to work remotely for almost three years.

A real estate agent in Boise, Idaho, said she had a pair of clients who are selling their home after only one year because their Seattle-based employer is ordering employees back into the office.

That means they are now looking to live closer to the city the left, so the daily commute becomes shoter. It's a prospect some Americans who fled metro areas during the pandemic now face.  

The pair will most likely sell their home at a loss because they purchased when prices were peaking in the pandemic aftermath.

'My sellers both work at the same company, which told them they have to be in the office three days a week or they'll lose their jobs. They have six months to make the move. They'll probably have to take a $100,000 loss on their home,' real estate agent Shauna Pendleton said.

'Their new house in Seattle won't be anything close to the size of their property in Boise, and their mortgage rate will be much higher.'

Donna Rutter, 59, bought a 11-acre ranchette in the Texas community of Rocky Creek Ranch three years ago - but she has now put her dream home on the market for $1.75 million because a call back to the office made her daily commute 45 minutes each way.

Rutter - who owns her own accounting firm - told The Wall Street Journal: 'Small businesses weren't really set up to work remotely. My clients want me in the office. They want to meet with me.'

Seattle-based real estate agent David Palmer said that since the beginning of 2023 he has received about 10 percent more inquiries than in 2022 from clients hoping to move closer to the city because their jobs are based in-person. 

'I have a buyer who moved out of the city during the pandemic. He now works for Google and, long story short, he needs to commute three days a week and it's about a two-hour commute each way,' Palmer said. 'So he's actively looking to buy something.' 

Fewer buyers are looking for property-criteria that makes working from home more comfortable, a recent study by Zillow.com showed.

Keywords such as 'home office' and 'cloffice' were mentioned far less during the first six months of 2023 compared to the same period last year.

The want for more space was also reflected by vacation home sale - that have since fallen by three-quarters from their peak during the pandemic as soaring interest rates and limited housing stock deters would-be buyers. 

Some 16 percent of existing home sales are now for vacation properties, down from a peak of 22 percent in January 2022, data from the National Association of Realtors show. The figure remains above the 14 percent average from late 2015 through to the first half of 2020.

A report from mortgage services firm Optimal Blue cited by Reuters shows that house sales in tourist hotspots Hilton Head Island, South Carolina, and Lake Havasu City, Arizona, have effectively dried up this year. Across the board, vacation home sales have fallen by 75 percent.

This housing trend shows that Americans are no longer desperate for spacious getaway houses in typical vacation destinations which were a hot commodity during the COVID-19 pandemic.

Redfin reported that there are many people who are moving today because they want bigger houses at smaller costs - which seems contradictory, but can be achieved if the property is in a less desirable area. 

Property experts recently identified the top 10 cities to move to if you want larger houses on a budget. 

The city featuring the most 'affordable mansions' was Indianapolis, Indiana, which was closely followed by Atlanta and Washington, D.C.

Hannah Jones, senior economic research analyst with Realtor.com, wrote in the report: 'Many of the metros on the list stand out for being generally affordable locales, with plenty of space to grow and sprawl. They tend to be less densely populated, especially as you get farther from the city center. So buyers can get more space at a lower price.'