Brandon Donnelly — Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly. — Page 577

The last decade has been pretty good for many cities. Recent 2020 Census data tells us that of the 50 largest cities in the US, 46 of them grew their population over the last 10 years. On average, these 50 cities grew by about 8.5%, compared to 5.6% for the decade between 2000-2010.

As you might expect, the fastest growing cities tended to be in the south and the west. The top 3 fastest growing cities over the last decade were Fort Worth (24%), Austin (21.7%), and Seattle (21.1%). The cities with the biggest population declines were Detroit (-10.5%), Baltimore (-5.7%), Milwaukee (-3%).

It's important to keep in mind that city boundaries can skew these numbers depending on how they are drawn. A declining "city" population doesn't necessarily mean that the broader urban area is losing people. Though it does still tell you something about the "city."

Another thing that happened over the last decade is that most of the largest US cities continued to become more diverse. In 2000, white populations were a majority (>50%) in 25 of the 50 largest cities. This dropped to 17 cities in 2010 and then 14 cities last year (2020). Meaning that 36 of the largest cities are now "white minority" cities.

For more data check out this recent article from Brookings .

A few of us are in Ireland right now visiting with the suppliers who will be providing the windows, sliding doors, louvers, and glass for One Delisle . Thank you for the hospitality Flynn, Duggan Systems, and Carey Glass.

Below is a video showing a weather test that was done this morning. If any of you have been to the One Delisle Sales Gallery, you will probably recognize these sliding doors. They are fantastic.

https://videopress.com/v/MSqkI5vJ?resizeToParent=true&cover=true&preloadContent=metadata

Many of us probably don’t think about the supply chain that exists behind the products and services that we consume. But it is there and there are lots of smart people working "behind the scenes" to make everything happen.

FYI, the doors passed.

Matt Levine's latest column is a good follow-up to yesterday's post about Zillow exiting the algorithmic home-buying business . In it, he talks about the differences between being a market maker and being a trader of homes. Part of his argument is that if you're a pure market maker then, in theory, you don't really care about where home values are going. Because either way, you're just earning a spread.

Here's an excerpt:

A market maker is someone who buys and sells an asset in order to profit from the spread, not someone who accurately forecasts the price of an asset six months from now. End users want to buy or sell stocks or bonds or houses, they want to do it quickly at a predictable price, so they go to a market maker who will provide that service. The market maker buys from sellers and sells from buyers and does its best to match them up; ideally it buys an asset from a seller and resells it to a buyer within a fairly short time. It collects a “spread” from the buyer and seller: It buys from the buyer at a bit less than the fair market price, and sells to the seller at a bit more than the fair market price, because it is providing them a valuable service, the service of “immediacy” or “liquidity,” the service of always being available to buy or sell. 

The problem with real estate is that you're not able to buy and sell with the same kind of rapidity:

But in the house business you can’t generally buy a house in the morning and sell it in the afternoon. You sign a contract to buy a house in the morning, then you do an inspection and title search and stuff, then a few weeks later you close on the house and deliver the money, then you spruce up the house a bit, then you wait for a buyer to come in — which takes, not seconds as it does in the stock market, but days or weeks or months — then you show the house to the buyer, then you sign a contract to sell it, then they do an inspection and title search and stuff, then you wait around for them to get a mortgage, then a few months later you close on the sale.

This is an important distinction. And so he argues that what we're actually talking about is the business of trading homes, which means that you have to have a view (and hopefully some conviction) on where home prices are going to go in the future. Sometimes you will be wrong. But that's okay, as long as you're right more often than you're wrong.