<p>The mutual-influence theory which explains the relationship between teleworking and housing relocation, has been conceived for a long time but has never been formally tested. We substantiate this theory by introducing the concept of “anticipated relocation gain” to connect the housing relocation decision with the teleworking decision. Models are formulated and empirically estimated using data collected in Shanghai, China, regarding people’s willingness to telework and their hypothetical relocation choices in the contexts of part-time and full-time teleworking, respectively. We find that people’s relocation choices under the influence of teleworking follow a pattern summarized as “globally decentralize and locally centralize.” At the metropolitan scale, more teleworkers are likely to relocate to provinces outside of Shanghai as the number of weekly teleworking days increases. Whether a residential location is the hometown of the decision-maker significantly influences immigrant residents considering a move back to their original locations while working remotely. Within Shanghai, teleworkers prefer living in the central city, favoring locations that are accessible to services and parks, less crowded, close to their workplaces (both their own and their partner’s), and familiar living environments. In the teleworking intention model, we find that the anticipated relocation gain plays a significant but minor positive role in the teleworking decision.</p>