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Why Renters Are Ending Up in the Suburbs

Most new homes being built in the U.S. are multifamily apartments, but more and more people are opting for an even cheaper rental option: the traditional suburban single-family home.
A rental home owned by Blackstone in Riverside, California.
A rental home owned by Blackstone in Riverside, California.Mike Blake/Reuters

Something doesn't quite square up between U.S. housing data and what we know about the changing demographics of U.S. metro areas. As Census Bureau data show, growth in cities is tilting ever so slightly back toward the suburbs. Yet multifamily housing, mostly situated in urban centers, is still driving the American housing market. Are developers out of step with demand?

Between 2010 and 2013, several U.S. cities saw more growth than they did over the entire course of the decade between 2000 and 2010. As the Brookings Institution's William H. Frey has reported, cities with populations greater than 250,000 are showing growth rates of slightly more than 1 percent, much higher than the average growth rate for the previous decade.