Moving out of the city may no longer give buyers more space for their money as square footage in suburban homes becomes more valuable than in urban homes.
Key Details
- The typical suburban home is now worth $206 per square foot compared to $205 per square foot for a home in the city.
- This flip in prices is the first time real-estate firm Redfin has recorded such a change since 2018.
- Prices on homes in the city are declining more quickly than in other neighborhoods.
Why it’s news
While the overall housing market is beginning to slow down, urban areas are seeing the most dramatic slow down in price growth.
Across the nation, city neighborhoods have seen a 3.5% year-of-year increase in price per square foot. While still higher than a few years ago, this is a dramatic decrease from the peak of the market.
Suburban areas on the other hand saw 9.5% growth and rural areas 8.4%.
Prices on homes are slowing down across the market, but cities are seeing the most significant drops. Homes in urban areas are selling for around $310,000, a 2.7% increase from last year.
Meanwhile, suburban homes are selling for 6.6% more at $385,000 and rural homes are 4% more at $333,000.
Homes in urban areas are smaller than suburban and rural homes, contributing to some of the price difference.
Potential home buyers looking to move out of the city for more spacious living are likely to be disappointed as their money will now buy less square footage than in the city.
