Exurbia Rising

Town and country must be married and out of this joyous union will spring a new hope, a new life, a new civilization.

                                —Ebenezer Howard, 1898¹

Perhaps nowhere is the gap between America’s cognitive elite and its populace larger than in their preferred urban forms. For nearly a century—interrupted only by the Depression and the Second World War—Americans have been heading further from the urban core, seeking affordable and safe communities with good schools, parks, and a generally more tranquil lifestyle. We keep pushing out despite the contrary desires of planners, academic experts, and some real estate interests. In 1950, the core cities accounted for nearly 24 percent of the U.S. population; today, the share is under 15 percent, according to demographer Wendell Cox. Between 2010 and 2020, the suburbs and exurbs of the major metropolitan areas gained 2.0 million net domestic migrants, while the urban core counties lost 2.7 million.²

This is less a growth in “bedroom suburbs,” supplying workers to the urban core, but one that serves multiple employment centers and commercial development.³ The latest edition of Commuting in America estimates that almost 70 percent of metropolitan-area workers now live and work in the suburbs; trips within suburbs or suburb-to-suburb commutes constitute more than double the commutes with a central business district as the final destination.⁴

The urban fringe is where the American dream is now being re­discovered. But these fringes remain widely disdained in academia, media, and the planning community. This was most evident during the financial crisis when there were widespread media accounts suggesting, among other things, that the exurbs would become “the next slums,” the equivalent of “roadkill” doomed by changing economics and demo­graphics.⁵ The New York Times even suggested how to carve up the suburban carcass, with some envisioning that suburban three-car garages would be “subdivided into rental units with street front cafés, shops and other local businesses,” while abandoned pools would become skateboard parks.⁶ Yet this is exactly what did not happen.

The Exurban Revolution

In the new Urban Reform Institute report, we identified the fifty high­est‑growth large counties in terms of net domestic migration from 2015 to 2019. These areas grew their population at 7.5 times the rate of the country’s other 3,100 counties during this period and gained 1.8 million net domestic migrants. Out of the fifty, all but seven are located in combined statistical areas (CSAs) of more than 500,000 residents. And each of these outer counties are within or close to a two-hour commute time of a central core county. Key areas include Atlanta, Dallas–Fort Worth, and Orlando.⁷

The key demographic headed to these places is young people in prime family formation years. From 2015 to 2019, these counties saw an increase in twenty-five- to thirty-four-year-olds of 12.8 percent, almost four times the 3.4 percent growth rate in the other counties. The high­est‑growth counties also have a far higher rate of school-age children (five- to fourteen-year-olds) per household than the rest of the nation—0.66 compared to 0.43 for the other counties. The highest growth counties have 3.5 times as many school-age children per household as, for example, Manhattan and San Francisco⁸ and 75 percent more school-age children per household than other counties in the United States.⁹

This migration is not a repeat of the “white flight” that drove peripheral growth a half century ago. To be sure, during the great mass suburbanization of the mid-twentieth century, many communities—Levittown and Lakewood are well-known examples—excluded ethnic minorities, providing planners and “smart growth” advocates a rationale to claim that single-family neighborhoods are inherently racist ever since.¹⁰ This assertion is seriously out of date, however. Over the past decade, non-Hispanic whites accounted for less than 4 percent of growth in suburbs and exurbs, while Latinos accounted for nearly half, with Asians, African Americans, mixed race, and other groups making up the balance.¹¹

These areas tend to be particularly attractive to well-educated immi­grants.¹² The wildly popular Woodlands planned community near Houston is roughly 30 percent Hispanic, African American, and Asian. In Irvine, California, arguably the most successful planned development, a majority of the population is nonwhite and over 40 percent Asian.¹³ In the Tres Lagos development in McAllen, Texas, three-quarters of all buyers are middle-class Hispanics, notes developer Nick Rhodes, for houses that average under $200,000. “We have a young population that is looking for larger homes and safety,” suggests the twenty-seven-year-old Rhodes. “These are people who cannot afford Irving or even Dallas but want parks and good schools.”

The Return of the Garden City

These new communities reflect notions of the “garden city” conceived by the great British planning visionary Ebenezer Howard. These would be somewhat self-contained small towns, surrounded by countryside and providing employment as well as amenities to their residents. The “garden city” movement reflected a reaction to the density, squalor, and class divides of Victorian Britain, and was seen as a humane alternative to the brutality of the industrial city¹⁴ by a vast range of luminaries, from H. G. Wells to Friedrich Engels.¹⁵

Such communities initially appealed to upper-middle-class people in the United States, but during the New Deal the government experimented with building garden cities. Three new cities were started, with the aim of creating bucolic, planned rental communities. In 1949, the federal government sold these homes to their residents, which have largely become successful suburban developments.¹⁶

During the 1950s wave of mass suburbanization, developers like William Levitt employed new techniques, developed in the military during World War II, to industrialize and rationalize production, driv­ing down costs at the price of monotony. These early suburbs were followed by developments closer to the garden city ideal like Reston, Columbia, Irvine, and Valencia. Harvard urban planning professor Ann Forsyth notes that these new communities fulfilled most of today’s New Urbanists’ underlying aim, and they did so at a grand scale, exhibiting “cutting-edge planning and design strategies.”¹⁷

Irvine, south of Los Angeles, founded around 1960, epitomizes the new model: a huge employment pool, short commutes, and lots of workers based at home. With 270 parks and one-third of the city’s land dedicated to open space, it represents by some accounts the most extensive urban park system in the country. The development has attracted an affluent population, much of it from Asia, with good schools and a low crime rate. Before Covid-19, the share of Irvine’s workforce that worked at home, 12 percent, was twice as large as the share within California or the overall United States (6 percent each).¹⁸

Parks, of course, can raise the price of new housing, particularly if developments are located closer to the urban core. Developers in Texas, for example, can build affordable units in the further periphery because of lower land costs and easier permitting. Developments that take decades to get approval, such as Tejon Ranch in California, necessarily absorb higher costs, and years of environmental tradeoffs make this kind of “garden city” more expensive than necessary.¹⁹

Even before the pandemic, exurban areas were growing quickly and nurturing new communities, particularly in more development-friendly states such as Texas, Nevada, and Arizona. Summerlin, in metro Las Vegas, boasts 250 parks, along with extensive recreational trails, shopping, and community centers. With one hundred thousand people, Summerlin is the nation’s third-fastest growing planned community. It’s also conveniently located near major job centers.²⁰

These features are repeated, in a very different climate, in New Albany, an outer suburban municipality in metro Columbus, Ohio. Over the past two decades, New Albany has relied on master planning to grow from 3,700 residents to more than ten thousand. Meanwhile, employment at the business park has grown to fifteen thousand. Its system of parks, neighborhoods, and walking paths hasn’t attracted only residents; since 1998, New Albany has gained more than $4 billion in private investment, fifteen thousand jobs, and more than $100 million in income tax revenue, according to the New Albany Finance Department.²¹ And this is before Intel announced its plans to build a new $20 billion chip manufacturing facility in New Albany in January 2022.

 The Pandemic Effects

The pandemic clearly hastened the shift to the periphery. Despite the disease’s relentless spread, the greatest concentrations of Covid fatalities have tended to be in dense urban areas. Much of this has to do not with population concentration per se but with the inevitable “exposure density” among those forced to take public transit, live in crowded apartments, and take elevators to work.²²

These concerns are behind what Zillow calls “the great re-shuffling” toward suburbs, the Sunbelt, and smaller cities. Between 2019 and 2021, preference for larger homes in less dense areas grew from 53 percent to 60 percent, according to the Pew Research Center.²³ During the pan­demic year alone, construction in exurbs increased 20 percent, faster than other geographies. Both prices and the rate of building have risen the fastest in exurbia, with price increases twice the national average, according to a Wall Street Journal analysis.²⁴

Planned communities have done particularly well; the fifty largest exceeded expectations in the first half of 2021 and are experiencing growth of 20 to 40 percent annually. Robert Schottenstein, CEO of Columbus-based M/I Homes, Inc., a builder with fifteen projects in the Midwest, Southeast, and Texas, explains, “This is a flight to safety and security. The millennials are getting older, and they are transitioning as they start families.”²⁵

In contrast, according to a New York Times estimate, New York City lost 420,000 residents in the early months of the pandemic. This is nearly as much as the entire 455,000 gain from 1950 to 2019. Some of these urban migrants headed to smaller metros, but Bloomberg’s City Lab found that 84 percent of movers in the top fifty metros stayed within the same metropolitan areas, most likely due to proximity to jobs, cultural centers, airports, and family.²⁶

Short of issuing “internal passports,” as in the former USSR, or a federal takeover of all housing, the market and social shift to the exurbs will continue. Attempts to reverse this situation at the company level may prove difficult, due to deep-seated labor shortages. This is particularly true of applicants for coveted technical and engineering jobs, many of whom are insisting on being able to work from home part of the time.²⁷ “You see tons of bold statements. Companies saying, ‘No remote work.’ But in reality, it’s the employees calling the shots. Some companies are saying, ‘We’re getting rid of all of our offices,’” says Bret Taylor, president and chief operating officer of Salesforce. “There’s like a free market of the future of work, and employees are choosing which path that they want to go on.”²⁸

Remote Work Accelerates Economic Dispersion

For decades, it has been an element of faith in the major media that the economic future lies primarily in a few, often very dense, “superstar cities.” The rest of the nation was considered home to the undereducated, old analog industries, and permanent backwardness.²⁹ Yet in reality traditional urban systems, based around dense downtowns and transit, have been losing ground since World War II in every major metropolitan area, according to research by Bumsoo Lee and Peter Gordon at the University of Southern California.³⁰ Since 2000, more than 90 percent of major metro employment was in the suburbs and exurbs.³¹

The tech industry, whether in coastal California, the suburbs of Seattle, Raleigh-Durham, or Boston, has driven much of this growth, notes Stanford University’s Margaret Pugh O’Mara. Places like Silicon Valley pushed closer to “classic definitions of cities in terms of their economic diversity and self-sufficiency.” These communities may be defined by strip malls, housing tracts, and automobile access, but they are no longer “amorphous extensions of the core.”³² Urban theorist Richard Florida has found that suburbs generate the bulk of patents; in fact, three-quarters come from areas with less than 3,500 people per square mile, less than half the density associated with urban centers.³³

During the last decade, roughly 80 percent of all job growth has been in the suburbs, which create the vast majority of all new jobs.³⁴ These trends appear to have accelerated during the pandemic.³⁵ Between Sep­tember 2019 and September 2020, the biggest job losses, according to a sampling of counties by the American Communities Project (and based on federal data), were in the largest municipalities, which lost 10 percent, followed by inner and outer suburbs, while exurbs lost less than 5 percent.³⁶ Many central business districts, including in New York and San Francisco, resembled “ghost towns,” noted the Financial Times. Since Covid-19 began, commercial tenants have given back around 200 million square feet of space, according to data from California commercial real estate advisers Marcus & Millichap, and the office vacancy rate stands at 16.2 percent, matching the peak of the financial crisis.³⁷

Once confident of their economic predominance, our biggest metros—Los Angeles, New York, and Chicago—account for three of the five highest unemployment rates among our fifty-one largest metro­politan areas. Things could get ugly as some $2 trillion in commercial real estate debt is due by 2025, particularly in large, transit-dependent central business districts. Reluctance among commuters to ride public conveyances, as well as concern over crime and social disorder, may have an impact.³⁸ Overall, it is widely expected that central business district office rents will not recover for at least five years.³⁹

Even when the pandemic fades away, the effect caused by the shift to online work will reduce the primacy of core cities. Many firms—though certainly not all—found that remote work often produced surprising productivity gains.⁴⁰ Early in the pandemic, perhaps 40 percent of the 155 million strong U.S. labor force was working from home full-time, up from 5.7 percent in 2019, which even pre-Covid easily exceeded the share of workers commuting by transit. When the pandemic ends, new research from Jose Maria Barrero, Nicholas Bloom, and Steven J. Davis suggests a “residual fear of proximity” and the preference for shorter commutes or none at all will mean that roughly 20 percent or more of all work will be done from home, almost four times the already growing rate before the pandemic.⁴¹

Can Exurbia Be Green?

Arguably, environmental concerns represent the strongest case against exurban growth. It is an element of almost religious faith in the environmental and planning communities that dense housing reduces greenhouse gases and saves energy. Yet a study by the Terner Center at the University of California–Berkeley, working under the assumption that housing development would be limited to infill (no greenfield development), found that the 1.8 million tons of greenhouses gases saved would contribute only 1 percentage point to the mandated state reduc­tion by 2030.⁴²

Indeed, cities were historically regarded as more of an environmental hazard than the surrounding countryside. Even now, a study released this year in Regional Science and Urban Economics based on German data found that “higher population density worsens local air quality,” an assertion backed by a study of U.S. cities.⁴³ As the Breakthrough Institute’s Judge Glock observes, urban residents have to endure a “heat island” effect, where urban concrete and asphalt amplify temperatures, something that can make daytime temperatures up to seven degrees Fahrenheit hotter in cities than in rural and suburban areas, and nighttime temperatures up to five degrees hotter, roughly equal to the estimate for the total impact of global warming by 2100.⁴⁴

Overall, a recent article in Nature Communications argues that “sprawling development will lead to a better thermal environment” by creating more green space and lowering the heat island effect by several degrees.⁴⁵ The relative environmental benefits of less density could be greatly enhanced by the rise of remote work, which by eliminating or reducing commutes, cuts both greenhouse gases and personal vehicle use, as has been recognized by environmental groups like Resources for the Future.⁴⁶

Yet even before the rise of remote work, notes MIT’s Alan Berger, suburban GHG emissions for individuals were found to be similar to GHG amounts for those living in the inner city, challenging a widely held assumption that living in the urban center is better for sustainability.⁴⁷ Changes in technology, such as innovative materials and sophisticated systems for controlling energy and water use, could make these new communities even more environmentally sustainable.⁴⁸

Simply put, given the enormous attraction of suburbs, governments should not make density and forced urbanization a central part of their program, suggests Breakthrough’s Glock. Instead, he argues, they should embrace “the same future that most Americans have already chosen.”

 Needed: A New Geographic Agenda

Despite clear evidence of a preference for lower-density housing, planners and their political allies continue to seek ways to curb single-family housing and clamp down on fringe development. This has already become policy in Minneapolis, Portland, and San Jose, as well as the state of California and, perhaps soon, New York.⁴⁹ This is often couched in the rationale of social justice, with the idea that by eliminating single-family housing, prices should drop for lower- and middle-class renters.

Yet forced density regimes not only fail to reduce prices, but actually tend to replace more affordable units with more expensive ones, as clearly shown by experiences in Vancouver, coastal California, and other regions. Indeed, virtually all the places with the highest prices—Los Angeles, San Jose, Vancouver, San Diego, and Portland—are also those with the strictest policies against expanding the urban footprint.⁵⁰ Some suggest that rents as well as house prices can be reduced by densifying existing areas, although new research from Europe, Canada, and the United States reveals that, if anything, forced densification raises prices by encouraging the construction of more expensive units and raising the price of urban land and housing.⁵¹

Sadly, President Biden’s priorities conflict with the aspirations of the country’s vast suburban, exurban, and small-town majorities. Biden appears to be sympathetic to calls to densify suburbs, similar to those proposed at end of the Obama years.⁵² The administration appears to have placed particular priority on already failing mass transit systems, even in the face of widespread cost overruns and painfully slow construction, most evident in California’s botched approach to high-speed rail.⁵³

What America needs—particularly for young families—is not poli­cies driving them to ever-smaller accommodations, as is common among greens, but a commitment to making the building of sustainable periph­eral communities a priority.⁵⁴ Right now, the best of the “garden city” communities—due to an almost insatiable demand—are being priced out of reach for most Americans. Prices in Irvine now top $1.1 million; houses in The Woodlands, New Albany, or Summerlin have median prices between $400,000 and $500,000.⁵⁵ That falls above the national median price of about $350,000, which is the purchase price at which a median income buyer could qualify for a conventional mortgage. In the new Canvas Park homes now being sold at Ontario Ranch in Southern California, detached homes go for $600,000 to $700,000, even further above the price at which a median-income buyer would qualify.⁵⁶

Rather than squash new developments, we should look at successful approaches, as have worked in Texas and, to some extent, Colorado, which allow developers to build their own water, sewage, road, and other infrastructure on county lands through Municipal Utility Districts (MUDs). Texas has more than nine hundred MUDs averaging about a thousand acres each; about two-thirds are in the Houston metro area.⁵⁷ Similarly, Colorado has over 1,800 metro districts, which are similar in purpose and scope to the Texas MUDs.⁵⁸

Much of this requires an approach very different from that taken in the recent federal infrastructure bill, as well as the more ambitious “Build Back Better” program. Much of what we need to do for the peri­phery does not require massive investment—you don’t need to widen freeways—if a third of your workforce labors at home or close by. Instead, we need a better understanding of how we can accomplish a successful exurban strategy without the kind of massive investment that is routinely seen as critical to rescuing the prominence of urban cores.

To meet our environmental goals, we should encourage, not suppress, the potential of online, remote, and hybrid work. Rather than rely on transit, which is in steep decline around the world, some states and countries are adjusting to this new reality.⁵⁹ Ireland has adopted a National Remote Work Strategy that would disperse population to more affordable areas.⁶⁰ In January 2022, Canada’s second-largest province introduced a program that will have all employees whose job responsibilities allow it work from home three days per week, and various U.S. communities, such as Tulsa, Oklahoma, are building their development strategy around luring remote workers.⁶¹

Transportation policy is, of course, still a critical area, and the administration and many local governments’ focus on mobility is largely about transit. Outside older “streetcar suburbs,” however, exurbs are almost totally auto dependent. The administration’s transportation sec­retary, Pete Buttigieg, embraces the idea of getting Americans out of their cars and into trains and buses. For at least half a century, this has been a principal public policy objective—and the results have been spectacularly unsuccessful. Despite the expenditure of more than $2 trillion and the construction of many new rail systems, transit’s share of daily commute trips dropped 44 percent from 1970 to 2019 (8.9 percent to 5.0 percent). Even prior to Covid, more people worked at home than took transit, which already accounted for less than 2 percent of all urban travel. The administration nonetheless is thinking about taxing vehicle mileage to pay for transit infrastructure, something that would be wildly unpopular outside of the handful of dense urban cores where transit-ridership is high.

The administration’s focus on transit makes sense, in a political context, as it appeals more in those few municipalities (not entire metro areas) with large downtowns such as New York, Chicago, Philadelphia, San Francisco, Boston, and Washington. These municipalities accommodate nearly 60 percent of transit work-trip destinations (New York City itself accounts for 36 percent) but only about 6 percent of the country’s jobs. This focus does not address the travel needs of precisely those areas—auto-oriented suburbs—that are growing fastest.⁶²

Simply put, for most Americans, transit does not work. In the nation’s major metropolitan areas (those with a population over one million), cars can reach almost fifty-five times as many potential jobs as transit in less than thirty minutes, according to University of Minnesota research. This helps explain why a key goal of the long-standing transit focus—to get drivers out of their cars—has not been achieved at all, as more people drive alone.

A principal purpose of federal subsidies to build urban rail systems was to attract drivers away from cars. But a review of twenty-three completed rail systems shows that no such thing occurred. Overall, where the new systems have opened, the percentage of commuters driving alone has increased. Even in the largest metropolitan areas, the average transit commute takes about 75 percent longer than the average auto commute.⁶³ And high-density communities, notes Wendell Cox, have far longer commutes—led by New York and Los Angeles—than more “sprawling” communities like Dallas–Fort Worth. Exurbanites generally have shorter commutes, in part because they are not generally headed to large urban business districts. Transit cities tend to have the longest commutes.⁶⁴

Perhaps the best evidence of the failure to attract drivers comes from the Los Angeles region. Slate predicted in 2012 that L.A. would be “the next great transit city.” Yet the Los Angeles County bus and rail operator has spent more than $20 billion to open urban rail lines since 1985 only to see ridership drop by a quarter while population increased by two million. This should not be a surprise, since L.A. commuters can reach thirty-two times as many jobs by car as by transit in less than thirty minutes in the metro area, according to a University of Minnesota analysis.⁶⁵

A more sensible policy in these areas might be to encourage not only at-home work but also the use of dial-a-ride service, which requires less infrastructure and is better suited to the needs of most Americans.⁶⁶ Further down the road, the exurbs may become ideal places for what Alan Berger calls “the autonomous suburb.” Such communities would be able to drastically reduce the need for parking or garages. Autonomous vehicles could simply be called out when needed, from a central place. Unlike traditional transit, this approach does not sacrifice privacy, efficiency, or speed, particularly outside a few dense urban cores.⁶⁷

Technology could also benefit housing construction, through the development of manufactured housing, which is increasingly being used to cut costs by as much as 50 percent in many new planned developments. And modular construction has the potential to reduce build times by as much as 50 percent, according to a 2019 McKinsey report.⁶⁸ AI technology and 3-D printers are already being used to build new tracts in the nation’s hottest big city market, Austin.⁶⁹

A New Urban Era

This is more than a matter of appealing to middle-class sensitivities. As we have shown, affordable suburbs have a magnetic appeal to families and prospective families. Without the growth of peripheral communities, America’s future is likely to be one of rapid aging and declining birth rates, squandering one advantage in our competition with places like Japan, western Europe, and China.⁷⁰

The exurban revolution also provides a possible solution to the rising barriers to homeownership, and a hedge against the relentless concentration of ownership by Wall Street landlords. Financial interests hope to reap a steady profit stream by creating a “rentership society,” in which potential owners are transformed into tenants. Today, pension funds and Wall Street firms are buying up single-family homes, often at prices too high for the average buyer. For their part, the planning clerisy believes that dense urbanism is socially, economically, and environmentally superior; some even favor a return to public housing, which not long ago was rejected as a massively failed experiment.

Cities today, notes a recent MIT study, have vanishingly little to offer working-class people, whose upward mobility has been restrained by the difficulty of acquiring property.⁷¹ In the end, the shift to exurbia, likely to continue in future decades, should not be seen as destroying urbanism but simply pioneering its latest adaptation. Such communities, suggested Frank Lloyd Wright, could serve as “a means of liberation” for families by allowing them to work at home or nearby, and close to the blessings of nature. That they don’t live in crowded apart­ments or take a train to work does not exclude them from the metropolis.

Affordable, safe, healthy, communities are vital to maintaining our country’s greatest asset: the families creating the next generation. None of this should be seen as an abandonment of the city, but rather as a sign of its continuing reinvention. As Frank Llyod Wright suggested: “After all is said and done, he—the citizen—is really the city. The city is going wherever he goes.”⁷²

This article originally appeared in American Affairs Volume VI, Number 1 (Spring 2022): 82–98.

Notes