Can’t Afford The City Life? Suburbs Could Be Out of Reach Soon Too
Even the suburban dream is becoming out of reach for many — unless you live with your parents. In recent years, the rise of remote work, higher cost of living and growing crime rates have pushed more and more Americans towards the suburbs.
Between 2010 and 2020, the percentage of Americans living in suburbs has risen by 10.5% and per a Bank of America survey this year, 45% of millennials are also planning to buy their home in the suburbs.
Chasing cheaper suburban home prices? Might want to pull your expectations back. An Apartment List report has shown that suburban rent has been increasing faster than in core cities in recent years.
- Between March 2020 and July 2023, suburban rent had risen 25.4% compared to 17.8% for core cities.
- The widest gap between suburb and core city rent growth was in Portland (21.1%), Seattle (17%) and Detroit (16.8%).
- The largest overall rent increase was in San Diego (39.3%), Miami (37%) and Indianapolis (36.5%).
Despite national rents falling in the past year, suburban rents have fallen less than those in core cities. And research firm Green Street expects landlord rental returns from single-family homes to be the highest this year, per WSJ.
How are counties tackling rising rental prices?
1/ More housing: US apartment growth is on track to hit a record high this year, with 461K new units expected to be delivered. Between 2023-2025, 1.35M units are projected to be built — topping the 1.2M units built in the past three years.
2/ Rent stabilization: Earlier this year, Boston voted to introduce rent stabilization rules — while lawmakers in other states like Colorado, Minnesota and California are also considering ways to control rent. And one small town in New York is even demanding rent decreases.
3/ “Missing middle” housing: Zoning laws only allow building single-family homes in many counties. In recent years, several counties have changed zoning laws to allow for denser housing like duplexes and smaller apartments.