Mark Hinshaw in Crosscut provides yet another entry in the exurbs-are-dying genre. A few years ago, I wrote two posts reacting to previous articles in this thread. There have been others over the years, most notably this Freakonomics roundtable.
For me, though, Matt Yglesias applies the critical sober analysis:
Rising gas prices and various other considerations have prompted this increased round of speculation on whether the suburbanization of America will reverse, but the right answer needs to take into account the fact that what policy choices we make will have a strong impact on the course of the future.
Here’s the money graf:
It’s totally plausible that we’ll respond to high energy prices by keeping our transportation spending priorities similar, while incumbent homeowners in-or-near walkable places respond to increased demand by enacting tight development restrictions in order to maintain artificial scarcity of housing stock and maximize the value of their homes. A similar overall proportion of the population would live in the suburbs, but the urban/suburban socioeconomic mix would continue shifting (“demographic inversion”) and overall quality of life will be hampered. Alternatively, we could alter our land use rules to facilitate the construction of denser areas and shift transportation spending priorities. That would slow sprawl, encourage inner suburbs to become less “suburban,” and a shift of the population base toward the cities. That would also be the more prosperity-friendly solution (not because cities are awesome, but because it’s more economically efficient to allocate resources in a manner less constrained by arbitrary regulatory barriers) and I hope it’s the solution we adopt, but whether or not we do it is totally uncertain.
The only thing I have to add is that the population of most metro areas will continue to grow. So in his first scenario, where we keep the statutory status quo, you might see demographic inversion, but over an increasingly sprawling area. Homes in Seattle and Bellevue become more unaffordable than they already are. As you get to current outer suburbs and exurbs, incomes steadily decline, until you reach towns that currently haven’t been absorbed into the metropolis yet. These towns would grow up to be sprawling exurbs, with the added problem of being of a lower socioeconomic stratum than that currently associated with exurbs.
In the second scenario, increased density moderates prices in the core, creating a mix of housing prices throughout the metro region. Furthermore, since growth is directed inward, the geographic metro region has roughly the same limits it has today.
26 Replies to “Demographics and Land Use”
I put this sort of post in the category of climate alarmism. “Should”, “would” and “could” are not reportable facts.
And a “critical sober analysis” is not dependent on an “increased round of speculation”.
And while it could be “totally plausible”, it is also plausible the decrease cost of suburban real estate could make these desirable neighborhoods affordable by more people even without subprime mortgages.
If the cost of real estate in car-dependent areas declines but the cost of driving increases nothing’s more affordable to anyone. If the areas are desirable, why else would their property values go down?
If the cost of the mortgage goes down, then that leaves more money for retail consumption.
Hence, as I proposed, the suburban home and lifestyle becomes more affordable to all.
Instead of $3000 jumbo mortgage, a more reasonable $1200 a month mortgage leaves that extra money for cars, gas, clothes and other consumables that can fuel the exurban lifestyle.
As far as what’s driving down the price (everywhere)…go ask Mr. Bernanke. All I know is that a lot of pent up demand from brand new homes with yards in neighborhoods that have nice schools is going to be met.
“Instead of $3000 jumbo mortgage, a more reasonable $1200 a month mortgage leaves that extra money for cars, gas, clothes and other consumables that can fuel the exurban lifestyle.”
Let us know when hydrogen cars become mass commodities in the suburbs. And also any sign of people producing clothes and other consumables closer to home and with less fuel inputs and long-distance material inputs. Then their exurban lifestyle would become less of a burden on the rest of us and the planet.
PS. High-speed rail is so expensive it competes with high-end airfares, and that’s just between big cities. A high-speed rail grid in rural Washington would be too expensive for most people to use. The only possible alternative would be regular rail (79 mph) or possibly medium-speed rail (90-110 mph). This would be much cheaper and would still give reasonable travel times across the state.
The problem with Seattle-Spokane rail is not the theoretical maximum speed, but the fact that it runs once a day in the middle of the night, and that it runs slower than the maximum speed.
I personally don’t think exurbs are dying, maybe they’ll slow down, but they aren’t going to stop. We should build more in the cities from now on, but I don’t necessarily think we should restrict market-based development in the exurbs. (We also should not restrict it in the city)
Sure, as long as gas is taxed enough to represent the externalities of burning it. I’ve heard estimates that a $10/gallon tax would be appropriate for this.
Markets don’t work by magic, they work because parties tend to agree to transactions that are mutually beneficial. If there are externalities as serious as those from burning fossil fuels a market-based “decision” won’t be a good one. Certainly, trying to limit exurban growth in specific places by specific regulations can result in even worse “decisions” — a lot of inner suburbia was once the urban fringe, and functions poorly in its new role because of outdated planning.
(Many people think that energy constraints, including those that we really should self-impose to limit climate change, won’t necessarily cause suburbs to collapse into the cities, but cause re-localization. If Enumclaw grows population filling its own local jobs, supplying local needs, that’s awesome — if it grows population commuting to downtown Seattle that is un-awesome, in terms of energy use.)
Very few private developers build housing with the intention of marketing it to the less well-off. Many of the costs of construction — permitting, basic materials, labor — are fixed, and developers therefore desire to build for middle- or upper-end demands so as to maximize the return on those costs.
Not since the immigrant-oriented tenements of the 1890s has any significant quantity of housing been built for the express purpose of housing poor people for profit. Today, we end up with lower-end market-rate units only when middle-class housing stock ages and its former inhabitants have moved elsewhere. (Aging modern housing stock will also cost less than newer stock in the same location, all other things being equal.)
So at some point, when developers see the writing on the wall (the decreasing appeal of ex-urban development to their desired class of buyer), they will lose interest in building it. Hopefully they’ll start aggressively building it in places that can support density and will welcome it. (They might bulk up their lobbying arm in less welcoming places, with less desirable results.)
Developers, like all people, are slow to alter the professional behaviors that have worked in the past, so there might be a lag time, with many bankruptcies, before they give up on ex-urban projects. But they will give up on them rather than building homes no choice buyer wants.
You may not read the Seattle PI, but every day their home page splash ad is for $139,000 ($700-900 a month) starter homes…
John, did you notice the location? The PI doesn’t show me the same ads and all I found on Redfin was down in Spanaway.
Never mind I was blocking the ads.
It’s Polygon and the only thing at the 139,000 price range are condos (SeaTac). The cheapest houses listed are in Tumwater, starting at 189,990.
My friend has a house in SeaTac he’s debating whether to sell. It’s currently worth $180-200K, down from $240.
Yup, a fire sale advertised in the Post-Existencer.
Totally sounds like the work of developers with their fingers on the pulse of the future.
That picture of the cul-de-sac makes me so mad. Everyone who reads STB knows how evil they are. It’s like they don’t even care about the future of your planet. Why are these selfish people still living in suburbs when all the data shows that if you care about our mother earth, you will pack-up and move to the nearest large city.
(rolls eyes) Live where you want, Sam. If you’ve paid attention then you’ve noticed most of the debate is about letting more people in to Seattle, not blocking people from living in sprawl. At most we talk about removing the subsidies that help this type of construction make sense, and very rarely talk about protecting the forests and farms that were bulldozed to create them.
I personally think the people living in the houses above will all lose money on the value of their homes as gas prices increase, and their cost of living will rise with fuel costs. Today’s Thomas Friedman story includes an interesting fact: gas prices were $1.66 a gallon on 9/11/01. Can you really still claim that we haven’t hit peak oil, or that the price of oil will drop any day now?
For the home owner, the cul de sac has many advantages.
Remember, the birth of the gridded city, something new to mankind, was so that the Roman centurions could scan up and down the block for trouble.
The rectilinear grid was the original street cam.
The cul del sac is an optimal mathematical model…anyone who studies fractal geometry will see its efficiency, as it mimics many natural structures…such as the veins in a leaf.
If people never traveled from one leaf to another that might make sense!
Typically most trips would not be end node to end node, but end node to main vein…and so on to the commercial areas.
As far as internode transport, what the cul de sac does is minimizes traffic as you reach toward the final destination.
A cul de sac essentially make a neighborhood as “carfree” as you would want … with only those cars that need to be there travelling within the node.
For you computer types…a b+ tree.
And 100 yard trips that require a full mile.
And the branches become ever-worse the bigger they get.
Cul de sacs offer separation, but they’re very inefficient for even car transportation, and they’re horrendous in every other way.
“That picture of the cul-de-sac makes me so mad.”
Just think of it as a painting. The looping road looks vaguely like an Indian taj mahal roof. There, you just saved $10 in museum admission fees.
suburbs don’t depend on oil or money, they depend on people and tradition started a long time ago. it is too bad that we can’t think back to a time in history of people that we really despise who had a horrible tradition to keep (slavery, etc)
“That picture of the cul-de-sac makes me so mad. Everyone who reads STB knows how evil they are.”
You want to know what’s really evil? The government leaders in this state and region who tout transit but back sprawl.
That picture is what the 6,500 planned homes in Cascadia, eastern Pierce County would look like. All the Sound Transit board members from Pierce County backed it. Ladenburg left Sound Transit and became its COO before Cascadia went into bankruptcy.
Taxes aren’t the problem, but development policies that promote sprawl while restricting more efficient urban living are. People ought to at least have the option of living in the city without either paying an artificial premium or running the gauntlet of restrictive urban planning guidelines. Let the free market decide – anything else is just social engineering.
[ot, ad hom]
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