Sam Zell Forecasts a Suburban Decline

I'll sub-in for later. This issue is nuanced, and I don't have time for a proper response right now...

There may be an increasing demand for urban housing, but there isn't enough space to develop. Many recent grads wants to move to NYC, Chicago and SF, but where else are you going to build housing units? It's only a matter of time before these places get hit because of the extremely high rents (higher demand for apartment buildings but the supply line will remain intact). If you cant afford living in urban markets, then the only logical option is the suburb (especially a town that offers quick access to w/e city). The guy is genius, but I don't buy it.

Let's think about this even further: what happens when you start a family and have 2 kids? You'll need more space and that 750SF apartment you're sharing with 3 other roommates wont cut it. Instead of paying a proportionate share of the rent/expenses, you'll pay for everything alone (tripling the cost). Again, you'll leave the city because it's too expensive.

Suburbia will always have a place for people at various stages of life, whether lifestyle changes or space needs. Sam didn't say much other than the fact that youth is generally attracted to urban areas which isn't really news. For the next few decades growth in older age groups is going to outpace younger age groups anyways.

I think you have to take several things into factor here. A lot of them, students, are looking for employment and the best places to find that is in those bigger cities. Additionally, you have to take in the fact that not many students could afford to buy a house straight out of college. Living nearer to the hub of what's going on is much better for them from an entertainment, practical and budget standpoint.

However, as several people have already pointed out in this thread, that all changes after a period of time. That being when a person's salary grows and when they've started a family. Although it might be prudent for people live in the city when younger, its not realistically possible to grow a family in a place like downtown Chicago or New York. Once a person has a means to do that, you'll often find individuals with families moving back out into the suburbs. Because of that, I don't really see suburbia dying anytime soon.

Wow, I don't even know what to say. An amazingly poorly thought out assessment by a guy who is far more successful than me. Texas is the fastest growing state in the nation. Why? There are many reasons, but among them are cost of living and size of homes for low cost of living. And to his point, the urban schools will never be materially better in our lifetimes. If anything, they will continue to get progressively worse. And if anything, the advent of the autonomous vehicle and the continued growth in working from home will lead to the furthering of suburban sprawl.

But it's not a zero sum game. There will be continued growth in urban areas, fueled by foreign immigration. Net population growth over the last 2 decades in NYC has been entirely driven by foreign immigration. There was net negative migration of current residents out of NYC for the vast majority of years going back 50 years.

I agree with him. I see a (not complete, but meaningful) paradigm shift between generations. I don't think many people that are 22-30 are looking to be encumbered by mortgages. I think there's a few things going on here. #1, the most obvious thing, real estate prices aren't always going to go up. previously, this was basically assumed. #2, people from the previous generation and before the credit crunch often assumed they'd be in their jobs far longer than our generation assumed. This obviously doesn't really apply to our demographic, but that doesn't matter. Decades ago the average person changed jobs far fewer times than today's worker does. Moving jobs > don't want to be tied down to a mortgage > rent instead of own.