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Urban vs. Suburban Rentals: Where Should You Invest?

Choosing between urban vs. suburban rental properties can be a major decision for investors. After all, each area has pros and cons, whether one’s more convenient or more low-key. Either way, each option can be an excellent choice for rental properties. Today, we’ll review some of the main differences to help you decide where to invest. So, read along to learn more about urban vs. suburban rental properties. 


Contents of This Article:

What Is an Urban Area?

If you’re considering purchasing a rental property, you may be looking in an urban or suburban area for your investment. An urban area is characterized by a high concentration of buildings, infrastructure, and people. Typically, urban areas are found in the heart of a city or town, where there’s a lot of activity, businesses, and residential spaces. 

Urban areas are typically very busy, with amenities like shops, parks, and accessible public transportation.


Additionally, they’re places where communities come together, and you can find a wide range of services, entertainment options, and cultural activities. 

If you think of the most popular urban areas in the United States, you may think of cities like: 

  • New York
  • Los Angeles
  • Philadelphia
  • San Fransisco
  • Chicago

What Is a Suburban Area?

On the other hand, a suburban area is a place located on the outskirts or near the edges of a large city or town. They’re a bit farther away from bustling city centers and are known for having more space and fewer buildings compared to urban areas. 

Suburban areas often have houses with yards, parks, and a quieter atmosphere. Most of the time, suburbs are popular among families because they offer a more peaceful and family-friendly environment. Additionally, they typically have good schools, and unlike those who live in the city, residents often rely on cars to get around rather than public transportation. 

Urban vs. Suburban: Main Differences

Investing in an urban vs. suburban area ultimately depends on your investment goals, target demographic, and who you’d like to market to. As such, conducting thorough market research and looking at the pros and cons can help you make informed choices about where to invest. 

Before we dive into some of the pros and cons of each, here are some of the main differences to note. 

  1. Location
  2. Population Density
  3. Cost of Living
  4. Atmosphere
  5. Infrastructure


One of the main distinctions between urban and suburban areas lies in their locations. For instance, urban areas are typically in the heart of cities, surrounded by a bustling landscape of buildings and thriving businesses. Conversely, suburban areas are usually on the outskirts, offering a quieter, more residential environment. 


Population Density

In urban areas, you can’t help but notice an exciting energy fueled by a higher population density. The streets are buzzing with activity as more people occupy a relatively compact space. In contrast, suburban areas provide a breath of fresh air with lower population density, allowing for more spacious living environments. 

Cost of Living

The urban lifestyle often comes with a higher price tag. Higher property prices, rent, and overall cost of goods and services contribute to a higher cost of living. On the other hand, suburban areas are more modest, offering a more affordable way of life, including accessible housing options. 


Urban areas thrive on a dynamic, fast-paced atmosphere. Cultural amenities, a large selection of dining options, entertainment venues, and a vibrant nightlife create an exciting ambiance. However, in suburban areas, things are more serene and slow. Parks, recreational facilities, and a focus on community-centered activities set the tone for a relaxed and family-friendly environment. 


Urban landscapes are defined by their towering structures and extensive built-up infrastructure. Skyscrapers, well-connected transportation systems, and a high concentration of commercial facilities characterize urban areas. Suburban areas offer a balanced mix of residential and commercial development, with a focus on single-family homes, townhouses, and lower-rise buildings. 

Pros and Cons of Each Area for Rentals

Deciding between urban vs. suburban rentals depends on several factors, including your investment goals, budget, risk tolerance, and target demographic. That said, both areas have their own advantages and disadvantages. Here are some of the top considerations for each. 

Pros of Urban Areas

  • Higher Demand- Urban areas typically experience higher demand for rental properties due to factors like proximity to amenities, job opportunities, and cultural attractions.
  • Convenience- Rental properties in urban areas are often more convenient, as they’re close to a wider range of amenities like shopping centers, restaurants, and entertainment venues. Additionally, public transportation is more abundant in more densely populated areas.
  • Diverse Tenant Pool- Urban areas attract a diverse range of tenants, including young professionals, students, or individuals looking for a fun city lifestyle. This diversity can lead to a broader tenant pool for property owners and Washington DC property managers.

Cons of Urban Areas

  • Higher Costs- Real estate prices in urban areas tend to be higher, meaning property costs can be more significant. Additionally, operating expenses and property taxes may be higher.
  • Smaller Properties- Urban properties are often smaller in size due to limited space and availability. This can limit the type of tenants you attract, as families or individuals seeking larger living spaces may be less inclined to choose urban rentals.
  • Less Outdoor Space- Urban areas may have limited green spaces, parks, and open areas compared to suburban or rural locations. This can be a drawback for individuals or families who value outdoor activities and access to nature.


Pros of Suburban Areas

  • More Affordable- Suburban areas generally offer more affordable housing options compared to urban areas. This can make it more accessible for individuals and families with budget constraints.
  • Steady Rental Demand- Suburban areas often have a stable rental market, as many tenants may search for quieter, family-friendly environments with good schools and amenities.
  • Family-Friendly Environment- Suburban areas provide a family-friendly atmosphere with access to parks, playgrounds, and quality schools. This makes them a more attractive option for families with children.

Cons of Suburban Areas

  • Longer Commutes- Suburban residents may face longer commutes toward the city, especially if that’s where they work. This can result in more time spent on transportation and potentially higher commuting costs.
  • Less Draw- Suburban areas often offer fewer cultural amenities, entertainment options, and a less vibrant nightlife than urban areas. This may be a drawback for individuals looking for a more dynamic lifestyle.
  • Smaller Tenant Pool- Suburban areas may attract a more specific demographic, like families, which may limit your potential tenant pool. Additionally, this may require a more targeted approach to marketing and property management.

Where Should You Invest?

When deciding where to invest in a rental property, there are several things to consider. Now that we’ve gone over some of the differences between urban vs. suburban rentals, you can make a more informed decision about where to buy real estate. Ultimately, it depends on your budget, investment goals, and property management strategy. 

How can Bay property management group help?

If you’re looking for a more efficient way to manage your rental properties, whether they’re in the heart of the city or on the outskirts, you may benefit from professional property management. Bay Property Management Group offers comprehensive rental management services, including property marketing, tenant screening, rent collection, maintenance, and more. So, if you need help managing your properties in or around Baltimore, Philadelphia, Northern Virginia, or Washington, DC, contact BMG today!