The Re-Urbanization of America

Tab 1

August 05, 2016


The “American dream” is on the move, and this may provide a number of new investment opportunities in the coming years.

 

Beginning in 2011, city populations in major metropolitan areas grew faster than their respective suburban populations for the first time since the 1920s, reversing a 90-year trend of suburbanization, according to the U.S. Census Bureau.

 

A number of factors are contributing to this shift, says Tom Hainlin, National Investment Strategist of Ascent Private Capital Management of U.S. Bank.

 

Volatile energy prices and longer commute times have reduced the attractiveness of suburban living. 

Technological advancements are changing traditional notions of work, education, entertainment and shopping.

 

Leading this urbanization trend are the baby boom and millennial generations, which together account for half of the total U.S. population.

Tab 2

August 05, 2016


Some members of the baby boom generation are empty nesters looking to downsize from relatively large suburban homes in an effort to reduce cost and upkeep and to be closer to urban medical facilities, museums, theaters, galleries and parks.

 

Meanwhile, millennials appear to value urban centers for their public transportation systems, short walking distances to school or work and cultural diversity.“The millennial generation has grown up connected, and many want to be close to what’s happening. They don’t want to be far away from everything,” Hainlin says. Many young adults who grew up during the housing crisis might also view the luxuries of suburban living as unrealistic, Hainlin says. As a result, many are flocking to cities to live in apartments instead of large houses

All of these changes may have a significant impact on the market in the coming years.

 

The re-urbanization of America provides potential areas for investment you may want to consider, if appropriate for your situation.

 

This includes high-density real estate, firms that provide goods and services to urban residents, firms that specialize in design and construction of mixed-use urban structures and firms that specialize in multifamily or “right-sized” single-family home design and construction.

 

For Tom Hainlin’s video and a fact sheet on “Re-Urbanization of America,” click here

 

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