The new developments may look different – including having a fair share of higher-density housing – but the trend appears to show the suburbs are attracting more people than center cities. This, despite a belief among demographers that younger generations preferred more urban living.
This turn of events is baffling the experts, too. According to a recently released study by the renown Urban Land Institute (ULI), growth in the suburbs is occurring faster than first thought. The study even shows that this was happening earlier last decade, when it was believed that millennials were leading the flight to smarter, transit-friendly downtown neighborhoods.
Indeed, that wasn’t happening at all: past data show that urban living was reduced to a trickle while the suburbs grew at a rate of nearly 15 percent.
Still, childless households still enjoy the amenities associated with living downtown and multifamily living still dominates urban centers. In fact, the choices of young couples and empty-nesters that defined urban living – locational conveniences, such as shopping, nightlife and greater proximity to sporting and cultural events – continue at a healthy pace.
But, as more millennials await their first child, demand for a single-family lifestyle is being revived. Recent population numbers bear this out. According to the Census Bureau, growth in the suburbs grew faster than in urban areas over the last year or so. Rural areas report a similar surge.
Value is having a real affect and is causing an expected behavioral change. Rental housing continues to be preferred in downtown markets. Yet, when renting is compared to the equity growth that comes with homeownership – and when across-the-board rent hikes continue and with still relatively low interest rates out there – urban dwellers are turning outward.
Affordability may be playing a role, too. Downtown development continues to face challenges that can ultimately run up the cost of construction – land, infrastructure, steel and concrete versus wood framing, zoning and hostile neighborhoods – while projects in the suburbs and exurbs are usually able to avoid similar constraints.
Moreover, newer homebuyers are beginning to settle for differences in planning and design in the suburbs. That means economies – like higher densities and mixed uses – can be had.
And, it’s still friendlier to build in the suburbs.