Urban Exodus is when a large number of the population leave big cities to move to the suburbs or rural areas.
Over the last 50 years or so, there has been an increased level of concern about people who live in large cities relocating to rural areas, such as the suburbs. In that time, several publications were created that expounded on this possible phenomenon.
One was uniquely titled “Urban Exodus”.
This quickly brought together those that considered themselves to be “urbanists” and those that are responsible for the planning and development of urban neighborhoods and cities.
In recent years, the increase of crime, increased populations of various cultures, increased tax rates, and high-priced housing has resulted in many engaging in the exodus or the leaving or departure of urban areas.
Since the onset of the 2020 COVID-19 pandemic, the urban exodus is becoming increasingly more common.
Continue reading to learn what the urban exodus is and what it is all about. This is must-read information – especially if you have a vested interest in the real estate market.
What Does “Urban Exodus” Mean?
In order to effectively expound on the urban exodus, we feel it is first important to break down the phrase so that it is easily understood. Now, if you are into real estate, you know that the word “urban” means that the area is a city or a geographical area that is not rural.
Examples of urban cities in the State of Colorado – for example – are Denver, Colorado Springs, Aurora, Fort Collins, Lakewood, and Thornton. The word “exodus” means leaving, the going out, or the departure of a large number of people. So, in short, “urban exodus” refers to large amounts of people living the big cities.
Why are People Leaving the Big Cities?
While people leaving big cities like Denver has been occurring for approximately 50 years now, this seems to have become increasingly popular in 2020.
For many, it was evident that the coronavirus pandemic not only had an immediate impact on the availability of work, worship, education, and socialization, but that it would have a lasting impact.
In a survey conducted by the Harris Poll, it was established that approximately 40% of all people living in urban cities consider leaving the city for environments that are less crowded.
While many considered this to be anecdotal, data from a wide range of companies have established that, yes, there is an unusual and highly significant uptick in relocations.
For many people, the thought of living in a less crowded environment was considered to be a health move. With the rise of infections associated with COVID-19 and the high levels of death among the infected, many feared for their lives – and understandably so. In addition to this, the shut downs impacted the urban areas the most. Many people were laid off from work or their positions were completely eliminated. As a result, many discovered that they could no longer afford to reside and live in urban areas.
Then, there were those that not only lived and worked in urban areas, but they attended high educational facilities that were shut down and had to move to virtual learning environments. When the big cities lost their “luster”, people started to leave in clusters.
Even before the pandemic, younger people were moving too.
The next reason that many people are leaving urban areas is the fact that there has been a significant increase in both crime rates and social unrest.
With the influx of protests, the development of movements, and the political dissatisfaction at an all-time high, many feels that the urban environment is no longer safe for them and their families. Social distancing has become more than a CDC guideline to eliminate the risk for developing COVID-19.
It has transitioned into a new norm where people are finally acting on the opportunity to distance themselves from their neighbors, crime, politics, expenses, and the historical social unrest that is often common to large cities. As a result, we have all seen the headlines that teether on the fact that big cities located in the United States are now experiencing their own “deaths”.
In terms of real estate, Redfin has confirmed that nearly 30% of all homebuyers attempted to move from urban areas to rural areas in the second quarter of 2020. The three cities with the largest number of moves were New York City, Washington D.C, and San Francisco.
Managing the Urban Exodus as a Landlord
If you are a manager of apartments, commercial buildings, and other types of residences located in the urban cities within the nation, it is likely that you have felt some degree of unrest among your tenants.
City managers and others – such as bond investors that specialize in municipalities are also feeling it.
The pandemic – all on its own – has resulted in an extremely high level of revenue loss, in terms of taxes. In addition to this, the protests and riots in major cities has resulted in immense costs for repairs.
While it is still possible to profit in real estate during the urban exodus, it will take the assistance of a property management company as well a lot of creativity.
It is simply becoming too expensive for people to live in urban areas. As a result, many will move to rural areas. You will, though, have the opportunity to rent to those that come in from rural areas seeking the opportunities that the urban area offers.
The Hot Housing Market in Suburbia
As a real estate investor, you must go where the money is flowing. Even if you have properties in urban areas, it is acceptable – and even recommended – that you diversify your portfolio. You may do this by purchasing properties in rural areas because the housing market is extremely hot in today’s suburban communities.
You have to act fast, though.
The increased demand for homes in the suburbs is resulting in a housing shortage and increasing the prices of these properties. The best news is, if you have to take out a mortgage, you will pay record low rates.
Since September 2020, there has been a 13% increase in home prices in rural areas. Redfin states that almost half of all homes that are put in the market will have an offer in two weeks or less – which means massive and quick profits for you!
The Transition
Now – than ever before – is the time to opt for the rural market. If you get in fast, you will not only get the best prices, but you will be able to experience the highest level of profits. The urban exodus could – at first glance -appear to be detrimental; however, it is a new opportunity for real estate investors. It is a creative solution to a property problem occurring in big cities.
We here at Pioneer will work side-by-side with you to uncover the best deals and the best opportunities currently available in today’s rural regions. We not only help in discovering properties, but we also offer management services that will take all of the work out of it for you! To learn more, simply contact us today at: 720-839-7482
