Generation Y Wants the Dream Neighborhood, Not the Dream Home

by Mark Wellborn

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Generation Y** (or Gen Y) is much more interested in living in a neighborhood that they like rather than a home that they love, according to Neil Takemoto, founder of Cooltown Beta Communities, a company focused on “crowdsourced development of places with significant economic, environmental and social benefit.”

Takemoto’s reasoning hinges on the theory that this generation is “motivated by experiences not consumption or home size” and they will opt for smaller homes and apartments that are less expensive, so that they might have more money to enjoy those experiences.

Here are some other theories of Takemoto’s, a few of which are based on information from the Canadian housing study Drivers of Apartment Living in Canada for the Twenty-First Century:

  • Micro lofts are the new McMansions i.e. 250 to 270 square foot units.
  • If you have attainably-priced, walkable, urban, transit-oriented two-three bedroom apartments and micro lofts, Gen Yers are ready to move in asap.
  • For Gen Yers, driving isn’t part of the American Dream anymore. Being connected is. That means walkable and transit-oriented, and that means downtowns and cities.

For more insights from Takemoto, click here.

**(Generation Y is a loosely applied label to people who were born between 1980 and 1990.)

See other articles related to: smaller homes, generation y

This article originally published at http://dc.urbanturf.com/articles/blog/generation_y_wants_the_dream_neighborhood_not_the_dream_home/2739

23 Comments

  1. Mike said at 2:46 pm on Monday December 6, 2010:

    I’m not Gen Y (I’m Gen X), but feel this way.  Give me a walkable, connected neighborhood over a McMansion in the burbs any day.  250 sq ft is small, but 1000 is fine for a small family and keeps me from accumulating a bunch of stuff I don’t need.  The experience is what’s all about anyway.  It’s hard to travel if you have a $4000 mortgage note.

  1. Elise said at 2:55 pm on Monday December 6, 2010:

    I couldn’t live in 250 sf, but would rather buy a 900 sf place in a neighborhood I like versus a 2,000 sf place somewhere that I didn’t.

  1. Rebecca said at 3:03 pm on Monday December 6, 2010:

    Where can we learn more about micro-lofts in the DC area? I think they are fascinating, if not a bit cramped…

  1. Jaime said at 5:40 pm on Monday December 6, 2010:

    I’m a Gen-Yer and have had these discussions with my boyfriend.  I am more than willing to give up square footage and my car for a real neighborhood experience.  I’d love to be able to walk to a local restaurant, shops, and a grocery store.  It’s not the case right now.  I echo Rebecca’s sentiment and would love to see more options like this featured in UrbanTurf.

  1. jag said at 5:47 pm on Monday December 6, 2010:

    I’m a GenYer too and this hits the nail on the head. The baby boom version of the American Dream is pretty laughable to 98% of people my age.

  1. Jane said at 8:11 pm on Monday December 6, 2010:

    Yes, but much of Gen Y doesn’t yet have school aged children. The tune will change as this group reaches their mid 30’s and have to consider the school system of the city they live in.

    For now, I prefer the neighborhood, but later I will prefer the school system.

  1. Ariya said at 8:29 pm on Monday December 6, 2010:

    I’m a Gen X’er and I would much rather live in a small space in an awesome neighborhood than to live in an enormous space out in the suburbs.  (IKEA has some great ideas for furnishing a 250 sq. ft. apartment).  I’ve never understood why so many people moved out of the city.

  1. jag said at 8:55 pm on Monday December 6, 2010:

    Jane,
    I’m not too sure that’ll be the case. There are a lot of GenXers still living in urban areas and with the increased density of NoVa and southern MoCo (the strongest of school systems), along with the increasing number of quality schools in DC proper, I think GenYers will have an even easier time finding quality schools without moving outside the beltway.

  1. Jane said at 10:12 am on Tuesday December 7, 2010:

    Jag,

    Depends on where you live. Can be touch and go. Ny fiance and I just bought a house in the city because we am not ready to give up city living just yet… but we already plan to move out of the city as soon as we have a child that is school aged. Where we live, it’s the luck of the draw if you could get your kid into a good charter schoolm - not a risk we will take. We can’t afford private school and DC schools are not where they need to be for us to feel comfortable staying.

  1. Donald said at 10:47 am on Tuesday December 7, 2010:

    Isn’t this only true until the Gen Y’ers get married, start having kids, and then start complaining about the bars on the corners of their blocks and the noise and lack of outdoor play space and then move to a bigger house in the suburbs? Seems to me, young people wanting to live in the city is nothing new.

  1. Mike said at 10:51 am on Tuesday December 7, 2010:

    I think the smaller house, community feel is happening all over the place, even if it’s not in the city.  Notice all the town centers that have popped up in the past 10 years..Reston, Easton in Columbus, there is a push to do something in Tysons, the “urban villages” in Arlington, Shirlington, etc. Those far out ‘burbs are trending towards decline.

  1. Mark Wellborn said at 10:57 am on Tuesday December 7, 2010:

    I don’t think that Takemoto’s argument is necessarily city versus suburb, but rather the argument of living in a small condo in a more “popular” neighborhood like Dupont or Logan versus living in a single-family home in a farther out area like Woodridge. He contends that right now, Gen Y’ers would choose the former.

    Mark Wellborn
    Editor

  1. anon said at 11:25 am on Tuesday December 7, 2010:

    i am gen Y and i agree 100%

  1. Anon said at 11:54 am on Tuesday December 7, 2010:

    Gen Y here. H Street is the perfect destination. Small rowhouse with neighborhood feel.

  1. Juliet Zucker said at 1:23 pm on Tuesday December 7, 2010:

    In real estate it is so much about location and especially in hot popular convenient urban neighborhoods you pay more & “get less,” square footage, that is. I think you more than compensate for that lack of living space when you can easily walk, bike, or hop on a bus or metro to go basically wherever/whenever. Great that Gen Yers are valuing living small and supporting healthy neighborhoods and local businesses (for the most part). There are currently 7 condos/coops listed for sale in neighoborhoods like Capitol Hill, Columbia Heights, Kalorama, Logan & Dupont, priced from $149,900 to $239,000 and ranging in size from 247 sq. ft. to 398 sq. ft. Not micro lofts (developers here don’t see the $$ in them, I guess), but certainly opportunities for people to own a pied-a-terre in DC neighborhoods that are well loved.

  1. K. said at 2:42 pm on Tuesday December 7, 2010:

    Finally young Americans are realizing this phenomenon. It has worked in Europe for years. However, think about what kind of people read UrbanTurf. I don’t think that the Gen-Yers in mid-America would agree on this one.

  1. Adam said at 3:03 pm on Tuesday December 7, 2010:

    I am on the Gen X/Gen Y cusp (born 1981) and the difference in attitudes between the two is palpable in my opinion.  The Gen X’ers I knew went for high-paying jobs and big mortgages almost right out of college.  When the Gen Y’ers reached the same age, most chose a city neighborhood and most drive used civics and the like.  The difference is real.

    Regarding the “good schools” shtick, it is important to remember that the highly-rated schools are in the suburbs because that is where the educated middle class wanted to live.  This did not happen the other way around.  There will be a “pulling” effect of schools, to be sure, but it can not be prolonged when the housing choice is urban, not suburban.

    Case-in-point: the Gen Yers and some late Gen Xers in my midwest urban neighborhood are having kids and staying put.  It is that simple.  Some use school vouchers, some pay for private school, and others use the city’s magnet system.  Still others go with the neighborhood school and have good results test-scores-be-damned.  It is more complicated than moving to the suburbs and throwing your kids in the highly-rated but monocultural school, but it is worth it.

  1. Citi said at 5:17 pm on Tuesday December 7, 2010:

    I’m a Boomer II, and have always been attracted to living in urban centers, even when my children were small and in school - easier to do in Europe since it is designed that way.  My children had the hardest time adapting to the massive suburban schools in the US when we returned (we tried suburbia) - they felt lost, and invisible in the sprawl.  We moved back to the city immediately so they could get right. The options provided in a city neighborhood environment worked best for our family.  I know I’m a bit of an anomaly - I get weird looks from most folks my age when I happen to mention I live downtown.

  1. whitney said at 6:05 pm on Tuesday December 7, 2010:

    I’ve found this to be true of many of my middle class white peers. (I’m 25.) Not necessarily among my black peer group in the D.C. area, who may still prefer driving and larger, more comfortable suburban apartments.

    This notion of “gen y” is mainly “gen middle class white y,” and, as usual, complete ignores other ethnicities and classes.

  1. aj said at 3:45 pm on Thursday December 9, 2010:

    I’m late gen x (ca 1977) and I chose to buy a small (750 sf 2-br) condo in adams morgan/dupont and give up the car-dependent lifestyle. If I have kids I will stay in the city. my choice is about quality of life but also investment. a car loses value the moment it is driven off the lot, but my condo in a well established neighborhood should only appreciate (I bought it after the bubble burst). I like to travel and a condo is easier to lock up and leave behind than a large house with a yard that needs maintenance. I’m in my mid-30’s so I am starting to get pretty bothered by the bar noise on weekends, but I’ll take it any day when my walks to the wine shop, thai food place, nail salon and dry cleaners sare all under a block.

  1. oboe said at 1:24 pm on Monday December 13, 2010:

    Gen Xer here:  as far as the question “Why did folks move out of the city?” and “Why are folks staying now?” the answer is that you need a critical mass to allow most middle-class families to stay in the city.  First public safety, then services (e.g. groceries, restaurants, etc…), then schools are made possible by a concentration of middle-class families—but it’s almost impossible to support those services without middle-class families.  That’s why turning around a city is so difficult.

    Once you hit that critical mass, though, revitalization tends to accelerate, and continue on that path.  As more folks choose the urban lifestyle, that urban environment becomes more and more attractive.  Consequently, the suburbs, have always had a pattern of new construction, decay, emigration, new construction further out, decay, emigration, new construction further out still.

    It gets to the point where the newest construction is simply too far out to appeal to folks who work in or near the city, and who want the cultural amenities the city has to offer.

    Meanwhile, Baby Boomers and Gen Xers who are still stuck in the old anti-urban prejudices can’t even see the wave coming, so they end up holding the bag—in the form of massively underwater mortgages in places like far exurban Phoenix and Las Vegas.

    After all, since that’s the way things have always worked, they’ll continue forever, right?

  1. Lmnop said at 1:12 pm on Thursday January 13, 2011:

    ” I don’t think that the Gen-Yers in mid-America would agree on this one.”
    This is a weak stereotype - don’t forget there are cities in “mid-America” too. Chicago, Minneapolis, Milwaukee, Madison etc. etc. all with great walkable neighborhoods that attract gen-y people for the same reason that popular neighborhoods in DC, NYC etc attract young people in those cities.  Bars, restaurants, grocery stores you can walk to, public transit, walkable blocks, interesting building stock (historic homes alongside apartments etc) and one thing that most east coast cities lack AFFORDABLE RENT : )

  1. Dana Hollish Hill said at 4:59 pm on Tuesday March 6, 2012:

    For years, I have been telling my clients the way I recommend they look at their home search. First Location. Then Lot. Then Home. Almost all buyers are able to take that piece of advice and put it to good use. Very few fall in love with a great home that is in a bad location or bad place within the neighborhood or building. They learn not to look at homes if they don’t meet their location and lot criteria.

    It seems to me that younger buyers are just looking at location and lot in a different way than others may have. Many younger buyers are choosing to stay in the denser urban areas with higher walk scores and stay in town when it is time to raise their children there. But I think the interest in the more walkable areas has increased among all age groups, not just Gen Y.

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