Why Families are Moving to Texas and Hipsters are Moving to Pittsburgh

Commentary, Housing Affordability, Steve Lafleur

Many municipal politicians, particularly in mid-sized cities, aspire to turn their city into the next trendy place, following in the steps of Portland or Brooklyn. Meanwhile, lesser fashionable places such as Houston, Phoenix, and Atlanta are swallowing up migrants from larger metropolitan areas. Though trendiness can attract a certain segment of the population, affordability and employment prospects are at least as important. In fact, contrary to the mythology, that is why Portland became trendy to begin with. It was an affordable place for young people to move and take a risk. That is decreasingly true, which is why hipsters are starting to migrate to affordable rustbelt cities such as Pittsburgh and Cleveland. And New York is no longer a place where bootstrapping young people can afford to start out. It’s where they aspire to move if and when they have already made it. Declining affordability in trendy cities presents a major opportunity to cities that focus on the basics: affordability and opportunity.

Cities in the Midwestern United States have experienced a renaissance over the past few decades. Cold and boring Minneapolis has become trendy MSP. Dodgy Kansas City has become the Austin of the Midwest. Fargo – oft portrayed as the Siberia of America – is now considered one of the best places to live in the country. Cities like Milwaukee, Duluth, and Omaha have experience similar urban renaissances.

Like the boom in the Sunbelt, Rustbelt growth is in part driven by people seeking out an affordable alternative to the hip coastal cities. The idea of staying put in Cleveland might have been unthinkable to young creatives a decade ago. Now that many can’t afford to move to Brooklyn, they’re making the best of it. LeBron James isn’t the only person choosing Cleveland nowadays.

Pittsburgh is particularly instructive. Like much of the Rustbelt, it suffered greatly from de-industrialization. The city has struggled to maintain infrastructure built for a much larger population, and has persistently high crime rates. Yet, people choose to move there. It helps that major foundations endowed by families such as the Carnegies and the Mellons have pumped money into the city, including to two excellent research universities, but that’s not why Pittsburgh is the new hipster destination; it’s because it is an affordable place to live a creative urban lifestyle. The proximity to other major centers helps, but creatives tend to choose neighbourhoods as much as they choose cities. Living in a trendy part of Pittsburgh or Cleveland is much more appealing than living in the suburbs of New York. One doesn’t have to live in the New York metropolitan area to thrive as an artist or entrepreneur.

Early gentrifiers tend to be much less risk-averse than the general population, so even if places like Pittsburgh might have some problematic neighbourhoods, cheap loft and gallery space can trump those concerns. Artists and independent coffee shops tend to seek these neighbourhoods for those reasons. They need undervalued space.

Of course, Pittsburgh’s turnaround isn’t driven entirely by artisans and hipsters. As demographer Jim Russell notes, one of the reasons why Pittsburgh is well positioned to attract young talent is that the city does a better job of developing talent. He attributes this to having an elite university in town. Russell pointed out that Portlanders collectively earn $2.8 billion less annually than the national average. It is, after all, the place that young people go to retire. As Russell notes, “people will take less pay to live in a cool place.” But that isn’t particularly sustainable, especially when the labour market becomes saturated with young people looking to work as baristas while writing the great American novel, and as rent prices increase due to that population influx.

Under the media radar, many mid-sized Canadian cities have blossomed over the past decade. Regina’s tiny urban core has developed a vibrant night life. Winnipeg quietly boasts – or should boast – a disproportionately good culinary scene (as well as a coffee scene that rivals Vancouver’s). Toronto spillover has gentrified much of Hamilton, and Windsor provides an attractive value proposition for entrepreneurs and artists (access to a major US hub airport right across the river is a major bonus).

While specific policy recommendations are difficult to tease out of these trends, one thing is abundantly clear: mid-sized cities don’t need to copy Portland to be successful. Their comparative advantage is affordability. They can attract both families and young creative types if they focus on the basics. Even cool kids need to pay the rent.