Moving to the suburbs may be an old trend as more and more homebuyers, looking for a shorter commute, invest in an urban lifestyle. Check out this article published by the Urban Land Institute and RCLCO Real Estate Advisors.
WASHINGTON – July 5, 2018 – For the first time in decades, the population growth of urban cities is keeping pace with the suburbs, according to a joint report by the Urban Land Institute and RCLCO Real Estate Advisors. More than 29 million Americans now live in urban neighborhoods.
Between 2000 and 2015, the population of urban downtowns rose by 1 percent—well below the suburbs’ 13 percent growth. However, urban and suburban areas grew at about the same rate between 2010 and 2015, according to the report. “During this time, denser urban locations grew significantly faster than more residential neighborhoods, suggesting that new urban residents are demonstrating a preference for mixed-use environments,” the report notes.
One explanation is that more jobs have been created in urban areas in recent years. In the 50 largest cities in the U.S., urban cores accounted for 30 percent of existing jobs and 36 percent of new job growth between 2005 and 2015, according to the report. The suburbs are experiencing job growth, too, but at a slower rate than downtown hubs.
Further, as more people seek to live downtown, rental development in urban areas is growing. Between 2010 and 2017, the rental inventory in urban cores rose twice as fast as the inventory in the suburbs—32 percent versus 16 percent, respectively. However, the report notes that affordability concerns in large cities remain. The average monthly rent of a multifamily apartment in an urban location is $1,650 compared to $1,275 in the suburbs. The average home value in urban areas also is $50,000 more than in the suburbs. Additionally, households in urban places tend to have lower incomes. averaging $66,000 compared to $89,000 in the suburbs.
“There are many different types of urban places, ranging from established central business districts to densifying residential neighborhoods,” according to the report. “Recognizing this diversity is key to facilitating conversations about the economic, demographic, and societal trends that are occurring in each type of neighborhood, as well as the implications that these trends are having on real estate.”
Source: “The New Geography of Urban Neighborhoods,” Urban Land Institute (June 2018)
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