45% of Millennials Now Have Plans to Buy a Home in Suburbia — and It Has Everything to Do With This Work Policy In the grand game of real estate, the suburbs are not just surviving — they're thriving — and it's all thanks to the game-changing work policy.
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In the grand game of real estate, there's a new king on the board. The suburbs are not just surviving, they're thriving, and it's all thanks to the game-changer that is flexible work. Who needs a skyscraper view when your office is your living room, and your commute, is a mere amble from bed to desk?
"We expect the ability to WFH to remain an incentive for young families to seek out more remote suburban and rural markets where housing may be more affordable," a recent Bank of America report suggests. It's like swapping a sardine-can city apartment for a comfortable, spacious home. It's not rocket science; it's simply the art of making work work for you.
The five-day office week, like the dodo, is heading for extinction. Lawrence Yun, the chief economist at the National Association of Realtors, says, "A little bit of a longer commute is not a hindrance" if you're not in the office Monday to Friday, 9-5. Not when you've got the flexibility to decide where and when you work. Why endure the daily urban rat race when you can occasionally roll with the relaxed suburban pace instead?
Related: A New Remote Work Trend is Helping Employers Retain Talent Amid Labor Market Pressures
Millennials: Not so urban after all
Remember when we thought millennials were city slickers, with their Uber rides and brunch habits? Turns out, they're embracing the suburban dream as eagerly as a kid pouncing on the last slice of pizza.
Hyojung Lee, a professor of housing and property management at Virginia Tech, humorously notes, "We've always talked about millennials as urban people... But it turns out they're not that cool anymore." Indeed, some 45% of millennials now plan to buy homes in the suburbs, according to a recent Bank of America survey. That's up from 33% in 2015. Perhaps it's not about being "cool" anymore but about being "smart."
The gourmet exodus: A culinary revolution in suburbia
This new suburban migration is not just about homes and workplaces. It's also transforming the gastronomic landscape. Urban retail vacancies surpassed suburban ones in 2022, for the first time since 2013, according to the Wall Street Journal. Like ants to a picnic, restaurants and retailers are flocking to these thriving town centers.
Consider the salad chain, Sweetgreen. Once a downtown staple, it's now making the suburbs its main stage with 50% of its locations nestled there. And it's not just salad — even big-name chefs are choosing suburban towns for their next culinary adventures. It's as if suburbia has become the new Manhattan for the restaurant world.
The face of suburbia is changing, too. Long associated with homogeneity, suburbs are now outpacing the national average for racial diversity, according to a Brookings Institution analysis. The stereotype of the white picket fence is slowly giving way to a vibrant mosaic of cultural diversity.
The city still stands: A reality check
Despite this suburban boom, downtowns aren't ready to throw in the towel just yet. Yun reminds us that people are returning to city centers, even in the hybrid work era. And while suburbs close to cities are flourishing, demand in the far-out 'burbs has dropped significantly since the pandemic's peak.
So, in this grand game of real estate, it's not about cities losing or suburbs winning. It's about recognizing that the playing field is changing. As we embrace the flexibility that technology affords us, our living preferences are evolving in turn. As I tell my clients whom I helped figure out their return to office and hybrid work plans, you need to go where your employees are, rather than simply trying to impose a top-down command-control structure on them — at least, if you want to retain your top talent.
Related: You Should Let Your Team Decide Their Approach to Hybrid Work. A Behavioral Economist Explains Why and How You Should Do It.
Cognitive biases: Unseen forces shaping our choices
Underneath our decision-making processes, cognitive biases often run the show. They're like puppeteers, subtly influencing our choices and judgments. Two key biases that might be influencing this suburban migration are the status quo bias and the anchoring bias.
First, let's consider the status quo bias. This is our tendency to prefer things to stay the same by doing nothing or maintaining our current or previous decision. With the onset of the pandemic, the status quo was disrupted, forcing us to adapt to a new "normal" — working from home.
For many, this temporary change has transformed into a comfortable routine. The novelty has worn off, replaced by the status quo bias. We've become accustomed to the convenience, freedom and flexibility of remote work. The prospect of returning to our previous lifestyle — the daily commute, the rigid office hours — seems more daunting than sticking to the new status quo.
The anchoring bias, on the other hand, refers to our tendency to rely too heavily on the first piece of information we encounter (the "anchor") when making decisions. When the pandemic hit, the "anchor" for many was the vision of a lifestyle free from daily commuting and office constraints. This initial impression has strongly influenced subsequent decisions about work and living arrangements.
Moreover, as we have seen suburban life flourish — with burgeoning retail spaces, diverse communities, and the promise of a more balanced lifestyle — these positive first impressions have only been reinforced. The anchor has been cast, and it's landed firmly in suburban territory.
By understanding these cognitive biases, we can make more informed decisions about our work and lifestyle choices. As we navigate this era of change, it's crucial to challenge our biases, question our assumptions, and remain open to all possibilities. Only then can we truly make the most of the opportunities that the future of work presents.
In the end, whether it's the city's siren call or the suburb's sweet serenade that wins your heart, it's clear that flexible work has forever changed the way we live. It's reshaped not just our working lives, but our homes, our communities and our landscapes. The suburbs are having their moment in the sun, not as a retreat from the city, but as a compelling alternative.