If you're a prospective homebuyer, you'd do well to consider the long-term value of your investment. And that means looking at where people are going to want to live a decade or two down the road.
While the suburbs are still king, higher-density communities are fast growing in popularity among potential homebuyers, who increasingly favor convenient access to work, recreation and shopping over more spacious neighborhoods with longer commutes.
"Walkability" a growing draw
It's been widely noted that young people increasingly favor the dynamic lifestyle offered by urban areas. But a new survey of community preferences by the National Association of Realtors (NAR) found some significant changes in broader consumer attitudes over the just the past two years.
In particular, consumer attitudes have nearly flipped since 2011over the desirability of living in "walkable" communities with smaller lots than more spacious neighborhoods where a car is needed to get to places like schools, shops and restaurants. They strongly favored the latter by 61-37 percent in the last survey two years ago, but practically reversed those positions in the current one, saying they'd prefer the more walkable neighborhoods by 55-40 percent.
Urban areas increasingly sought
While the vast majority of consumers continue to prefer smaller communities, the number of consumers attracted to city living increased sharply over the past two years. Twenty-eight percent of all respondents said they'd prefer to live in a city in the current survey, up from 19 percent in the 2011 survey.
Those who said they'd prefer living in an apartment or condominium over other types of housing increased to 14 percent in 2013, up from 8 percent in the previous survey.
Consumers show an increasing desire to have homes in socially dynamic areas. Those who said they felt it was important to have a home "near the center of things," as opposed to "away from it all" jumped by 10 points from the last survey, to 44 percent of all respondents, up from 34 percent in 2011.
To be sure, that increase came from the ranks of the indifferent; those who said it was important to have a home "away from it all" rose slightly to 55 percent of respondents, up from 53 percent in 2011.
Americans are also showing an increasing desire to live in diverse communities with people from a mix of racial and ethnic backgrounds. Fifty-three percent said such a quality was important to them in choosing an area to live in the new survey, up from 42 percent two years ago.
Suburbs still the top choice
Interestingly, attitudes toward commuting time don't appear to play a large role in Americans' changing preferences. Asked for their preference of a large lot with a longer commute versus a smaller lot with a shorter drive to work, they chose the former by 57-39 percent, nearly unchanged from two years ago.
Suburban living remains the most preferred option for Americans, chosen by 41 percent of those surveyed, down from 47 percent in 2011. The increase in those who favor city living over the past two years came largely from a decline in those who said they favor small towns or rural areas, which fell to 30 percent of all respondents, down from 40 percent in 2011.
Ironically, even though Americans increasingly say they'd prefer to live elsewhere, small towns and rural areas rate the highest in satisfaction among current residents, with 75 percent saying they are content with where they live. That compares to 68 percent of suburban residents and only 58 percent of city dwellers.