Back to the burbs: given no other choice

The popular narrative about younger generations aging and leaving urban centers is presented as inevitable. But most news stories fail to examine why many younger people are taking up residence in suburbia—or whether or not the suburbs they’re choosing have more in common with cities or the exurbs their parents preferred. Perhaps their move to the suburbs is more a product of constrained housing supply that leaves them with little choice but to decamp as they grow.

A recent article in the Wall Street Journal has been making the rounds on the internet: “American Suburbs Swell Again as a New Generation Escapes the City.” It’s just the latest in a long line of commentary claiming that millennials and younger Gen Xers are just like their baby boomer parents. As the narrative goes, younger generations that flocked to cities in their early years are now moving to the suburbs as they get older; they just got a late start because of the financial crisis. Or some variation on that.

While the numbers may bear out that suburban populations are indeed growing faster than urban cores in recent years, much of this commentary misses one big question: why?

Affordability is the most often cited answer for why younger generations are moving to the suburbs. Now that they’re older, getting married, and possibly having children, they find that they can’t afford a home in the city. But why is it that urban housing has become so unaffordable? Why do families feel they need to leave for the burbs? And how have suburbs transformed in the last 10 years to deliver more of what younger generations are clamoring for in the city?

20th century policy in the 21st century

Outdated, exclusionary zoning is one major reason younger people are leaving the city. In most American cities, large swaths of land are reserved exclusively for single-family homes; 70, 80, or even 90+ percent of residential land in some cities is reserved solely for single-family houses. Nationally, about 67 percent of existing housing stock is single-family homes.

As urban populations boom, demand for housing goes up and housing grows more scarce. The market would usually respond by building more housing, and in some neighborhoods that’s exactly what happens. But with so much land reserved for low-density, single-family development, available land quickly disappears while single-family areas go untouched.

With no way to address demand by increasing the supply, prices skyrocket and families or couples that would have otherwise lived in the city simply can’t afford to. City zoning should permit a variety of missing middle housing in single-family areas, allowing for incremental change and growth. Minneapolis recently updated it’s zoning to allow duplexes and triplexes city wide, allowing for more housing across the city in a way that won’t change neighborhoods overnight.

A second issue is the dearth of larger units. In recent years, most new multifamily housing has been studios and one-bedroom units, responding to the high-demand from the influx of young people (and boomers who are downsizing). Nationally, just 10 percent of multifamily units completed in 2018 had three or more bedrooms. These larger three- or four-bedroom homes that could accommodate a family with children—which are more often renting than owning a home—were often overlooked in favor of more lucrative, smaller units.

In Seattle, for example, “more than 80 percent of units constructed between 2012 and partway through 2017 were studios or one-bedrooms.” In DC, just under 30 percent [pdf] of housing has three or four bedrooms; and many of these units are occupied by multiple people renting out the rooms, not one nuclear family. Regulations/incentives are needed to ensure that some of the homes being constructed are large enough to suit a family, otherwise, families will be left with little choice but to find housing elsewhere.

The changing face of the suburbs

The allure of greater economic opportunity, social connection, diversity, and amenities like restaurants and artistic venues in urban areas—or some combination of those—doesn’t just evaporate as one ages. As the Wall Street Journal notes, “Nearly all of the [current] hot suburban locales have the good fortune to be a commute away from thriving cities or outposts of successful corporate businesses.” These new hot suburbs are often as close as these families can get without the exorbitant housing costs.

Which leads to a final point: the suburbs of today aren’t necessarily the suburbs of yesteryear. What matters is less whether a place is “in the suburbs” or “in the city” and more whether that area is designed for people (walkable) or designed for the car (drivable). In our report Foot Traffic Ahead 2019, we found that walkable areas are in extremely high demand. Given the option, businesses and developers were more likely to locate in walkable urban areas, both within the city limits and what would be considered the suburbs. In the Boston metro area for example, 40 percent of their walkable urban spaces are in urbanizing suburbs; in the Miami metro area, it’s 44 percent.

But walkable places—both urban and sub-urban—command huge price premiums because there isn’t enough supply. Traditional suburban communities like Bethesda, MD (bordering Washington, DC) or Lakewood, CO (bordering Denver) can be part of the housing solution by creating more housing in walkable, transit-accessible areas. Walkable areas attracting new investment and, as we noted a few weeks ago, these changing suburbs also need to build more housing in their mixed-use, walkable places.

“Escape” to or displaced to the suburbs?

The migration of younger generations to the suburbs is presented as a continuation of the inevitable. But they’re not moving indiscriminately. They’re finding more affordable places near walkable, urban areas, whether a major city or a vibrant small town center.

But the popular narrative also leads one to assume that millennials and Gen Xers are moving to the suburbs because they prefer the suburbs. That’s impossible to determine in a distorted market but also irrelevant. The simple fact is we have nowhere near enough housing supply in walkable places to meet the demand and what we do have is too expensive—the fact that drivable suburbs are someone’s only option says nothing about their preference.

We’re told younger generations are just like their parents: ‘We knew they’d move to the suburbs eventually.’ But in reality it looks like we’ve given them little other choice.