Rural-Urban divide among American homeowners? Part 1 of a 3-part series

Dubbed the great American "Rural-Urban Divide", or an "Urban-Rural Divide" sometimes when reported by writers from urban areas, there has been a lot of talk about the differences that set Americans from different locales apart. Our analysts and writers are less interested in politics, but we are curious about differences in ideals and motivations that drive American homebuyers, so we can learn to better serve and empower them.

In the past 18 months, ValueInsured has conducted in-depth consumer research quarterly with over 6,900 American homeowners, homebuyers and renters to understand how today’s modern homebuyers want to own and live in their homes, and how the housing industry can offer them a better way to buy. Countless interesting insights emerged, least of which are the differences among urban, suburban and rural residents. Today, we begin a 3-part series that explore these unique patterns.

But first, there are some resounding universal themes that transcend where a person lives. Americans from different township sizes overwhelmingly want to own homes. According to the latest ValueInsured Modern Homebuyer Survey conducted in April 2017:

  • 78% of all Americans who live in rural areas, 79% in suburban areas, and 83% in urban areas believe buying a home is more financially beneficial than renting; 
  • 76% of all Americans who live in rural areas, 76% in suburban areas, and 80% in urban areas say owning a home an important part of their American Dream;
  • Among non-homeowners, 79% in rural areas, 80% in suburban areas, and 81% in urban areas say they would like to buy a home; and 81% in rural, 77% in suburb, and 74% in urban areas say they would buy now if they could afford to.

However, the similarities seemingly stop there. One example that stands out is the transient nature of urban homeownership. While they all equally want to own homes (in fact, a marginally higher percentage of urban respondents expressed a desire to own), suburban and rural Americans plan to stay in the next home they buy longer. They are also more likely to describe the next home they buy as a “forever home”:

  • Only 35% of all urban homebuyers surveyed plan to stay in the next home they buy for 7 or more years, less than half of the 71% of suburban and rural homebuyers who plan the same;
  • Not surprisingly, the more transient nature of urban homeownership is correlated with the younger average age of our urban respondents, at 38.4 years-old, compared to our average rural respondent who is 47.6 years-old. This also correlates with twice as many urban respondents who describe the next home they plan to buy as a “starter home”;
  • Urban homebuyers’ plan to move more frequently is also likely related to their shorter job tenure and more mobile job locations. 70% of urban homebuyers say the possibility of a job change or job loss makes them worry about the risk of buying a home, while only 30% of rural and 42% of suburban respondents say the same.

There are many other ways urban, suburban and rural Americans differ in their attitudes and plan toward home buying. It may surprise many to hear that while family dynamics are often assumed to be more fluid among urbanites, and more stable and close-knit among suburbanite and rural residents, urban residents are more likely than rural and suburbanites to say they plan to rely on their family financially to buy a home, and in turn to support their parents and children in the future when they need to buy a home. As America continues to become urbanized with more people moving to cities – by some count at as high as 80% – these differences in attitudes in urban vs. rural areas are noteworthy, with implications on real estate, housing finance, urban planning and beyond. We will explore more of these unique patterns next week, in part 2 of our 3-part series.