Square Footage Is Worth More in Suburbs Than in Cities—Here’s Why

As pandemic-driven remote work attracts Americans to suburbs, and a housing correction sends home prices falling in popular metros, square footage was worth more in suburban homes than in urban homes in September for the first time in the data’s history, Redfin reports. The typical suburban home nationwide was worth $206 per square foot during the four weeks ending Sept. 25, compared with a per-square-foot valuation of $205 in urban neighborhoods.

Square footage costs follow the same trajectory of home price growth in and out of cities as the housing market cools. As home prices begin to decelerate in overheated metros, price per square foot is on the rise, with a 9.5% gain in suburbs and a 3.5% year-over-year increase in cities in September, still up on an annual basis, but down significantly from its pandemic peak.

Prices are falling from their peak quickest in cities partly because the remote-work trend has solidified. It has shifted from a pandemic necessity to a common arrangement as studies show that many employees prefer to work remotely either full time or part time. That makes homes in the suburbs and rural areas more desirable, appealing to house hunters searching for more space and a quieter lifestyle. Millennials in particular are keeping the suburban housing market afloat, as many are remote workers with young children who see the opportunity to live in highly rated school districts and skip commuting.

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