Smaller homes closer to urban areas may be the next wave of new construction, as post-bubble buyers seek smaller mortgage payments and shortened commutes.

At the “What’s Next: Real Estate in the New Economy” conference held by the Urban Land Institute of North Texas, keynote speaker Maureen McAvey, executive vice president of policy & practice for ULI, shared ULI’s research from its new publication, which shares the name of the conference.

Urban appeal may also reel in the suburban sprawl because of the wide availability of rentals near city centers.

“Apartments are on the rise and homeownership is falling,” McAvey said. “In 2006 and 2007, almost 70% of people owned homes. That is now down to 66.5%, and we believe it will settle at about 63%.”