Title: How Do Cities Grow?
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Content: Of course, cities can grow in many different ways and understanding the patterns of urban growth can help clarify the big picture in a real estate analysis. In this post we’ll discuss several different urban growth models that are commonly used to explain the growth patterns of cities. Concentric Circle Growth in Urban Development
The concentric circle growth model, or CCD model, was one of the first theoretical models of urban development. A sociologist named Ernest Burgess first developed this model in 1925. The urban development patterns in Chicago were the inspiration for the concentric circle growth model. Concentric circle growth starts with a central business district at the heart of the city. Everything grows up around this central hub of economic activity for the city. The concentric circle growth model is an application of bid-rent theory. Those who are able to pay the highest rents are located near the economic hub of the central business district. Real estate prices are lower as you move away from the central business district, but then people also need to consider transportation time and costs to get to work in the central business district.