Young, educated professionals are moving to U.S. cities, driving up prices and spurring more development. Of the top 30 percent of U.S. households by income, 400,000 more lived in urban neighborhoods in 2014 than did so in 2006, at the peak of the housing boom, according to a new University of California – Berkeley study.
Rents in cities nationwide now average about $1,730 a month, compared to $1,250 for suburban spaces, according to CoStar.
Home prices in cities are 2 percent higher on average than those in the suburbs — a reversal of the relationship in 2010, when suburban homes were worth 4 percent more on average, the Wall Street Journal reported.
Millennials are drawn to economic and cultural opportunities, a drop in crime, and the increased difficulty of financing home purchases after the housing bust. The influx is leading to higher real estate prices and new development, as well as upgrades to city infrastructure.
It’s not all roses, though.
“The housing affordability issues are no longer limited to the high-cost coastal cities” Stockton Williams of the Urban Land Institute’s Terwilliger Center for Housing told the Journal.
The Real Deal dove deeply into the effect of millennials on the real estate scene in its June issue. [WSJ] – Ariel Stulberg