The Urban Exodus Isn’t Happening Because Cities Have Changed – It’s Because They Haven’t
What's with all of the moving trucks everywhere?
If you live in a city you probably couldn’t help but notice moving trucks lining up your street in the past couple of weeks. The pandemic has inspired your neighbors and maybe even you to ask: what makes the city rent worth it? The “Urban Exodus” seems significant with all of these people moving out at the same time. The effects of whatever is going on are still too early to predict, but effects are where opportunity is found. Are there any new opportunities in mobility from The Urban Exodus?
Why do we live in cities at all?
To understand why people are leaving cities, let’s remind ourselves why people came to them in the first place. Cities are proximity. They are closeness to culture, experiences, and social serendipity. Proximity in cities also means jumping between amenities quickly and affordably. Cities cater to both convenience and curiosity. Urban amenities aren't only the basics like laundry, food, shelter, but also the weird, unique, cool things like concerts, pop-up stores, and listening speakeasies.
The pitch convincing everyone why the U-Hauls are abundant on their avenues is that the amenities of a city aren't here anymore due to the pandemic. We’ve moved to cities for the cool features, but now the pandemic has closed off our access to them–mainly social amenities. There are more trucks than what seems usual yes, so who are the people filling these trucks?
The three demographics leaving cities
First there's the wealthy. The people who can escape to their lake houses or second homes to enjoy a bit of distance from urban environments.
“...so many of the coronavirus hot spots in the Mountain West — Sun Valley, Idaho; Gunnison County, Colorado; Summit County, Utah; Gallatin County, Montana — overlap with winter playgrounds for the wealthy. The virus travels via people, and the people who travel the most, both domestically and internationally, are rich people.”
Anne Hellen Peterson’s writeup for Buzzfeed
Amanda Mull at The Atlantic did a great job compiling both cell phone and trash collection data from NYC and distilling this insight too, showing that the shifting behavior is largely from the wealthier boroughs of the city.
Then there's the tech crowd who can now work remotely and finally stop paying obscene rents in San Francisco. San Francisco has always been the shining example of horrendous rents and has seen a huge 12% YoY decline in rents.
People have been getting offers from their landlords to stay but some are just hitting the road and trying another city out for themselves for a little.
Finally there are millennials – the generation said to never be able to afford a home because of buying too much avocado toast. But one thing we've seemed to have forgotten is that they had to grow up. Urban amenities are not the amenities aging millennials need anymore… the requirements have shifted. Most of the people writing articles on The Exodus have been millennials who started them on a hunt to find out what unique trends were underway, but then discovered along the way that they’re just getting older.
It makes sense too. Look at this chart of aging generations (above). Most members of the Millennial generation (in yellow) are well into the phase of starting to settle down.
Bars, restaurants, concerts, cocktails – for a group of people looking to become situated these are not top of mind features for the next stage of life. Aging millennials are thinking about “school districts or smaller cities where child care and housing are more affordable” unsurprisingly. For a generation that has sacrificed half of their paychecks to rent, that affordability element is a substantial part of the decision to change how to live.
A pandemic is a catalyst for something different
Inertia is what causes most people to make or not make decisions. The pandemic is an inertia event. The people that have been thinking about leaving are using the inertia of something different to act on their plans. This is why it seems there are so many trucks outside – leases aren’t being renewed and people are saying “why not now?” for their long-brewing thoughts on settling down.
So are there opportunities for mobility from The Urban Exodus?
Disappointingly, there is not a lot of uniqueness in this situation when it comes to mobility. The current opportunities in transportation are caused by the conditions of the pandemic, not by people leaving.
There are no vacuums in mobility purchasing behavior that will need clever solutions to be filled at least in cities. Could there be a shift in mobility behavior for millennials that move to midsize or smaller cities? It’s unlikely while COVID times continue, but millennial migrants may bring with them a greater demand for some of the social-distanced urban amenities like safe streets in some of the bigger cities.
There are shifting behaviors in the way things move right now– just look at Uber's latest earnings where for the first time ever, their delivery business overtook their rideshare business. These shifts due to COVID are worth a different writeup entirely, but there aren’t any that are attributable to Urban Exodus – for now at least.
The Exodus is mostly a pandemic-accelerated decision by people who have already made the most of the social amenities their city had to offer. Cities are still vibrant cultural hubs and will continue to be. There are just a handful of residents who have now grown up and are looking for something else out of the places they live.