As more Americans take advantage of low mortgage rates and flee to the ‘burbs, young workers are also taking advantage and moving into cities—just not the pricey ones. New York City and San Francisco are left in the dust as more young people scoop up townhomes and condos in more affordable cities, such as Pittsburgh, Detroit, and Phoenix, according to Bloomberg. Urban home prices increased 15% in three months through January, bringing home prices ahead of suburbia’s annual pace. Redfin’s chief economist points out that the move into cities shows buyers are thinking long term and considering life after the pandemic.
Perhaps no part of the U.S. economy has been buoyed by the Federal Reserve’s easy-money policies more than housing, and with cities now joining the suburbs and exurbs in the boom, the impact on growth appears to be broadening. In some regions, urban areas are now substantially outperforming.
In Louisville, Kentucky, values for properties in the more densely populated neighborhoods surged at more than twice the rate that they did in suburbs over the past three months. Detroit, plagued by poverty but home to a downtown packed with gleaming new condo towers, saw urban prices soar 43%, almost quadruple the rate of less-dense parts. In urban Baltimore, prices jumped 34% while they rose 10% in outer areas.