CityLab editor at large Richard Florida shares the findings of a new Zillow study, which reports urban homes are now valued roughly 25% higher than suburban homes on a per-square-foot basis nationwide. The numbers overturn a long-held pattern from the late 1990s to early 2000s, when urban and suburban homes were worth just about the same on a per-square-foot basis.
By the end of 2015, the average, overall value of an urban home outpriced its suburban counterparts by 2% ($269,036 compared to $263,987), despite the fact that suburban homes tend to be considerably larger than urban ones.
This trend is clearly being driven by the extremely high price of urban homesin talent and knowledge hubs such as San Francisco, Boston, and Washington, D.C. In Boston, for example, urban and suburban homes were each valued at around $100 per square foot in 1997. By 2015, Boston’s urban homes were worth nearly $400 per square foot compared to nearly $250 per square foot for suburban ones.