Market demand
Demand for walkable, mixed-use, compact neighborhoods will likely run strong for at least the next 20 years. This chapter looks at changes in perception, demographic shifts, attitudes toward density, and other factors influencing the prospects for New Urbanism. By the late 1990s, perceptions about good places to live had begun to change. Traditional neighborhood developments on greenfield sites became successful, and housing boomed near historic downtowns. Developers and designers who went against the grain of conventional real estate wisdom were financially rewarded.
New urban communities have been found to command price premiums and to hold their value better than conventional developments. In the housing recession that began in 2006, urban and transit-accessible housing generally outperformed automobile-oriented suburban housing. This chapter explores findings from sources such as Zimmerman-Volk Associates (ZVA), GfK Roper, Arthur C. Nelson, Dowell Myers, Robert Charles Lesser & Co., and Joe Cortright, and the Urban Land Institute. One major phenomenon is an oversupply of large-lot housing, defined as houses on lots measuring more than 7,000 sq. ft. Experts report that through 2030, sales prospects will favor multifamily and small-lot single-family units possessing smart-growth traits such as walkability and a mix of uses. A table in this chapter compares changes in housing prices for close-in and outlying locations in five metropolitan areas, documenting the advantage of close-in neighborhoods.
ZVA has used a method called “target market analysis” to determine the potential market for urban housing. Researchers at the Center for Urban and Regional Studies at the University of North Carolina have found that consumers will accept mixed land uses as along as human scale and good design are readily apparent.
