Buying a Home in the City, Suburbs, and Country (What you need to know)

Home buying is all about location, location, location – but not all locations are created equal. There are considerable differences between buying a home in a city, buying in the suburbs and buying in the country.

Which one is right for you depends on what you want and need in a home at a particular point in your life. Here are some things to consider that might help you narrow down your next home search to an area that’s right for you.

Buying in the City

Like all lifestyles, urban living has its pros and cons. City living often means car-free living, easier commutes via public transportation, great opportunities for career advancement and easy access to nightlife, culture and commerce.

At the same time, living in the city may require some compromises. While detached single-family homes are a feature of most urban areas, their cost can be prohibitive for a first-time buyer. Many urban buyers choose a condo or co-op. These have their advantages — less maintenance, building amenities and a sense of community. However, these homes often require association fees, have less space and privacy and may be more difficult to sell.

Many cities are famous for central greenspaces, like Central Park or Golden Gate Park, but are unlikely to offer backwoods neighborhood hiking trails. City living can cost a premium, because of the higher demand and better access to desirable amenities. Still, in cities like New Orleans, Louisville, Ky. and Little Rock, Ark., buying is cheaper than renting.

As far as eventually selling your home in the city goes, you may be happy to know that homes appreciate faster in urban centers. In some cases, price growth is two to 10 times higher in urban areas. When it comes time for resale, appraisers look at a much smaller area for comparable urban sales, generally within a mile radius and sometimes within the same block.

Buying in the Suburbs

The suburbs are typically what one thinks of when they think of American home buying – a detached home in a neighborhood of similar homes, a front yard, a picket fence, maybe a garage and a backyard space for the dog to run around in.

Suburban buyers often worry more about commuter highway access and school districts than nightlife and public transport. School districts, particularly, can have a big impact on the demand in a particular neighborhood as well as price and resale value. Suburban home listings are also far more likely to list amenities like schools and parks and trails, than restaurants or museums.

Just a few years ago, experts predicted that millennial buyers would forego suburbs favored by past generations to live in urban locations. However, more recent data shows that nearly half of young buyers live in the suburbs. Studies even show suburban millennials are buying large SUVs to accommodate dogs and eventually kids. In fact, pet considerations can take priority for some families when it comes to finding a home with suitable outdoor space.

The downside to suburban living is often a longer commute to a nearby employment center. Unlike a condo with an association fee and full-time maintenance, indoor and outdoor home maintenance for the suburban dweller usually falls entirely on the homeowner. Resale values can be more unpredictable, and appraisers look further afield when assessing resale valuations. Purchasing a title insurance owner’s policy is particularly important for detached single-family homes in the suburbs, where many title defects can creep up.

Buying in the Country

Living out in the country can offer more space at a lower cost, more privacy and plenty of outdoor spaces for family and pet recreation. Larger lots are common, as is farmland, woodlands and even water features on the property.

As a downside, rural living may mean a much longer commute to a city or suburban job, as well as longer travel times for running errands and getting the kids to school and activities. However, modern technology means that some home buyers can enjoy the relaxed pace of country living while telecommuting to work from their home office.

Unlike urban and suburban living, rural home buyers may be able to take advantage of a special kind of mortgage loan, the U.S. Department of Agriculture (USDA) guaranteed rural development loan – a loan very few have even heard of. The USDA loan requires only a small annual fee and an upfront two-percent premium of the loan amount, which can be rolled into the mortgage for a zero-percent home loan.

Another factor that buyers in more developed regions don’t have to worry about is the quality of the land that comes with their property purchase. A general title insurance owner’s policy does not cover the physical state or condition of the land, and so it may not be enough protection for land or mineral interests. Rural parcels are also more likely to have restrictions on agricultural land use or be subject to contamination which could affect the property value. When it comes to appraisals, experts look at a wider area and longer timeframe to assess values.

Closing Thoughts

No matter where you choose to buy a home, there will be advantages to your chosen location as well as a few compromises needing to be made. Living in the city could be the best solution for a home buyer today, and yet living in the country could be ideal for the same buyer a decade from now. Different locations suit different home buyers at different stages of their lives.

When it comes to choosing where to target your next home search, take into consideration the specifics of what you need today and what you think you’ll need tomorrow. As families grow and change, be aware that your particular needs may change, and you may decide to choose a different type of home in the future that better suits your evolving needs.

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