For the first time in about a century, new Census data reveal that population growth in big U.S. cities is exceeding that of the suburbs. According to the Associated Press (via Huffington Post):
Primary cities in large metropolitan areas with populations of more than 1 million grew by 1.1 percent last year, compared with 0.9 percent in surrounding suburbs. While the definitions of city and suburb have changed over the decades, it’s the first time that growth of large core cities outpaced that of suburbs since the early 1900s.
In all, city growth in 2011 surpassed or equaled that of suburbs in roughly 33 of the nation’s 51 large metro areas, compared to just five in the last decade.
Young adults forgoing homeownership and embracing the conveniences of urban life appear to be a driving force behind this trend.
Burdened with college debt or toiling in temporary, lower-wage positions, they are spurning homeownership in the suburbs for shorter-term, no-strings-attached apartment living, public transit and proximity to potential jobs in larger cities…They make up roughly 1 in 6 Americans, and some sociologists are calling them “generation rent.”
A related report from NPR further cites tougher mortgage rules since the housing bubble burst as an important factor.
Even with big drops in housing prices and interest rates, getting a mortgage has become a lot harder since the heady days of “no income, no assets” loans that fueled the housing boom of the early 2000s. Most lenders now require a rock-steady source of income and a substantial down payment before they will even look at potential borrowers. And many millennials won’t be able to reach that steep threshold.
The combination of stricter mortgage requirements, college loan debt, and a tough economy leaves sociologist Katherine Newman skeptical of young adults’ prospects for home ownership for the foreseeable future. From Huffington Post:
“Young adults simply can’t amass the down payments needed and don’t have the earnings,” she said. “They will be renting for a very long time.”