Urban Fantasy; fantasy that is set in an urban environment, or in the contemporary time is a growing genre with Fantasy. It has been for at least a couple of decades to be fair, but now in a weird sort of triumvirate between detective and romance fiction, Urban Fantasy seems to have become more popular, and more solid in what it is. This has had the unfortunate effect of creating various cliches, detective wizards being probably the most pronounced of them, with mopey vampires who just want to be loved a close second. Like detective fiction too, UF has benefited from the series of novels approach, where the author creates standalone novels that form a series to explore their protagonist's adventures. This distances it from the traditional format of Fantasy, which is still mired in epics of ten books or more, or in the humble trilogy. It's interesting to note that this may be under threat from the vagaries of publishing as they become less willing to take risks.
There are two schools within the genre, one where the mystical stuff is hidden, tucked away behind the scenes. In this sort of world, there's what we might call a Masquerade, hidden away and thriving in a sort of underworld. Often for some reason, these are quite separate, vampires hang out with vampires, werewolves with werewolves and so on. I'm not really sure you don't get something like the Floating Market from Neverwhere, where they all get together for a party or just to have a beer or whatever. There doesn't seem to be a lot of socialising anyway in these books, which I think is a shame.
I'd argue that most series draw from this well, be in that in the form of the Dresden Files, or the Benedick Jaka series both of which feature wizards doing detective stuff.
The other alternative is that the monsters are out and proud, which often leads to the world having to adjust to their presence. This can be more problematic if only because the series seldom address what the effect that has on things like work or family. Obviously you don't want to cover too much of that sort of thing in fiction, most of us read for escapism after all, but I do think it's a shame that you don't see too many novels about werewolves looking for work or faeries having to deal with the breakdown of their families because of what they are (one of the joys of Fantasy fiction for me is that you can address social issues with little problem, using them as a way to extrapolate social issues and look at them in a safe way). Instead, the monsters are usually there to be mooks, allies and contacts in a world that's slightly off.
These stories are more associated with likes of True Blood, or the Laurel K Hamilton books. As a result, they are often more towards the paranormal romance end of the genre and they focus much more on relationships. I confess I find that vexing especially when the protagonists are portrayed as having a problem like telepathy, which gets them to have lots of hot supernatural sex.
Urban Fantasy chimes more with our modern lifestyle, in part, because as a species we are increasingly urban and the lives we lead are populated by crimes by romance and other things. That's not to say that they are dull, or that there's no magic in there. If anything the genre tries to plug the magic back into everyday life, which is something I really like.
In addition I like the way authors fit the various things into the worlds they build, the way that they pull all these strands in and fit it into the real world. I find it fascinating to see how many twists and turns they put in, the way that they take the real world and make it work. It's amazing, just amazing.