High fuel prices and walkability are key factors in many downtown buyers’ decision.

The quintessential American dream used to include a suburban house with big yard, but homebuyers are increasingly dreaming of a walkable urban lifestyle along with their dog and two kids.
Flight from urban areas began after World War II, when thousands of returning soldiers and their young families needed inexpensive housing. In Leviitown, an early Long Island, N.Y., suburb, developers built more than 17,000 virtually identical Cape Cods. The development served as a model for later ‘burbs, and the middle class migration out of the city continued until a peak in the 1980s.
A decade ago, downtown dwellers were rare outside metropolitan hubs like Philadelphia, New York and Chicago. Today, even in a struggling real estate market, property values are high for downtown listings — and so is buyer demand.
“The housing market collapse really hasn’t impacted Denver urban buyers. Inventory is low, and lots of buyers are sitting on the sidelines waiting for a property,” says John Skrabec, owner of Live Urban Real Estate in Denver, Colo. “If a downtown home is priced right and shows well, it sells quickly.”
So what’s driving buyers towards the city? Changing demographics are part of the puzzle. The children of the first generation of suburbanites are now aging empty-nesters, and they’re increasingly trading in their plot of land in the suburbs for sleek downtown condos. The birth rate dropped by almost 50 percent between 1950 and 2000, so there are fewer families with children to fill the spots in suburbia.
Rising fuel costs are another major factor. After payments on mortgages or rent, owning and driving vehicles is the second-biggest expense for most households.
Housing costs tend to fall as you move further from urban employment centers, but transportation costs rise. Once you reach a certain distance, typically 12 to 15 miles from the city center, the increase in transportation costs outweigh the housing savings, according to a report from the Center for Neighborhood Technology. As fuel costs rise, living in the suburbs gets more and more costly.
Living in a walkable area with access to public transit also decreases the total number of miles you drive per year. According to the Housing and Transportation Index, an average downtown dweller in Boston’s Roxbury neighborhood drives average 7,000 miles per year. Though Dedham, Mass. is still in “greater Boston,” drivers there log almost three times as many miles on the odometer — an average of 20,500 per year. Urban living can save you thousands of dollars per year in fuel costs and vehicle maintenance.
The price difference makes the old real estate adage “drive till you qualify” seem as “outdated as buying a gas-guzzling SUV,” quipped a recent article from the Congress on New Urbansim. In a June 2008 Coldwell Banker survey, 78 percent of sales associates said that rising gas prices are increasing their clients’ desire to live in an urban setting. The agents also said clients had increased interest in walkable communities with access to public transit.
For the same reasons — walkability, shorter commutes and access to amenities — new urbanist towns and mixed-use suburban developments are becoming another attractive option for buyers. Throughout the United States, small neighborhoods that combine residential, retail, cultural and educational spaces, like Kentlands, Md.; Celebration, Fla. and Stapleton, Colo. are gaining in popularity.
“If gasoline and heating costs continue to rise, conventional suburban living may not be much of a bargain in the future, said Christopher B. Leinberger, an urban land use expert and real estate developer, in a recent article in The Atlantic Monthly. “And as more Americans, particularly affluent Americans, move into urban communities, families may find that some of the suburbs’ other big advantages — better schools and safer communities — have eroded.”
Over the next 20 years, developers will likely produce many millions of new and renovated townhouses, condos and small-lot houses — as well as modify current large-lot suburbs — to meet changing demands.

In 1979, builder and developer Robert Davis founded the town of Seaside, Fla. on 80 acres of land he inherited from his grandfather. He hoped the new development would recapture the idyllic feeling of his childhood vacations by the Florida shore. Seaside is now cited as the first example of new urbanism, a design movement that strives to create walkable, sustainable communities with a diverse range of housing and jobs. As people react to the suburban sprawl prevalent in the United States, more new urban towns are cropping up around the country.

Photo courtesy of Steven Brooke Studios New urban towns attempt to provide a solution to suburban sprawl with compact, multi-use (residential and commercial) neighborhoods. Made up of closely spaced bungalow-style homes, Seaside encompasses the small-town atmosphere of the late 19th and early 20th centuries that new urbanism strives for.

If you want a traditional small-town feel without moving to the middle of nowhere, consider a place like Promenade in the city of Hercules, Calif.

Built near the waterfront of the San Francisco Bay and about 20 miles northeast of San Francisco, the houses have a historical look with Victorian, Craftsman or Italianate design. All have front porches to encourage neighborliness, are built close together and garages are, in many cases, located in the back of the houses or accessible by alleyways. Streets are narrow to slow down traffic.
“In contrast to many suburban towns, we know our neighbors. And we feel it’s a very safe place for children,” says Robert Reber, a city planner for Hercules who lives in Promenade with his wife and 4-year-old.
The New Urbanism Movement
Promenade is an example of a type of city planning called the new urbanism, which seeks to build or restore suburban towns to resemble small towns of the late 19th and early 20th century. A reaction against the suburban sprawl common today, new urbanist towns are planned communities near large urban centers. They have historical architecture, front porches and picket fences and are reminiscent of a time long gone. Built to encourage walking and biking rather than driving, they often have parks or a town plaza in the center of town and restaurants and small businesses within easy walking distance.
“New urbanist towns are gaining in popularity,” says David Kooris, director of the Connecticut office of the Regional Plan Association, a nonprofit that promotes improved community design in the New York metropolitan area. “The philosophy goes back to the historical patterns of development of the 1920s and 1930s — before the automobile dominated — and it was possible to walk and bike to see your neighbors and do your daily chores.”
When Promenade was completed in 2000, homebuyers snatched up the available 217 houses. In fact, all the houses in the community sold within 18 months for prices ranging from the low 400s to the mid-600s. While the pace of buying for two similar neighborhoods in Hercules has slowed a bit, the houses still have an appeal for homebuyers who want to live within commuting distance of San Francisco but also appreciate the advantages of a small town.
How It Began
The first new urbanist development in the United States was founded in 1979 by builder/developer Robert Davis on 80 acres in the planned community of Seaside, Fla., a town on the Florida Panhandle between Fort Walton Beach and Panama City. Many of the houses in Seaside are built in a bungalow style with wraparound porches and picket fences. The town has a central square surrounded by a post office, an amphitheater that hosts everything from yoga classes to theater performances and small businesses such as restaurants, ice cream shops and retail clothing shops.
“There is a certain character to houses in Seaside. But the idea of Seaside is more than cute houses; it’s also a pleasurable place to inhabit, where any resident can find things happening within a quarter-mile radius of their home,” says town architect Leo Casas, who notes that the commute from his Seaside home to his office is “150 yards with dog in tow.”
A Growing Trend
New urbanist towns are more common in the West and Midwest, where land is more plentiful, but there are examples of small towns on the East Coast that have rebuilt themselves based on new urbanist values. In towns such as Connecticut’s New Canaan, East Rutherford, N.J., and Newton, Mass., city planners have tried to revitalize their historic downtowns to provide a sense of community and more walkable neighborhoods, Korris says.
Seaside and Hercules are planning further development. In Hercules, a network of small neighborhoods interconnected by nature paths, parks and a transit center is in the works. Seaside’s plan calls for slowly increasing the size of the town in a series of buildouts. But the character of the place won’t be sacrificed, Casas said. “We’ll continue growing, but at a slow pace. Like many small towns, nothing happens too quickly here,” he said.