Wednesday, March 2, 2011

Housing's two great debates: own vs. rent, and urban vs. suburban

Source: The Atlantic

The Atlantic associate editor Derek Thompson helps crystalize housing's moment, the collision of interests around owning vs. renting, and around urban vs. suburban development. Thompson writes, "U.S. policy continues to support suburbanization over urbanization in countless ways. First, the U.S. has one of the smallest gas taxes in the developed world, which makes it cheap to drive 20 miles to work. Second, we subsidize mortgages more than most developed countries, which makes it cheap to drive 20 miles to work from your large home. Third, zombie zoning regulations make it difficult to build up in many urban centers, which restricts the supply of housing and office space, thus raising the price of housing and office space in cities. As Ed Glaesar wrote for The Atlantic, 'Many of the world's old and new cities have increasingly arrayed rules that prevent construction that would accommodate higher densities. If cities can't build up, then they will build out.'"

Urbanists are split on whether the future of America will involve the rise of the Plains and Sun Belt burbs, or the re-urbanization of our major cities If the 2000s are a glimpse of the future, than the suburban crowd is winning the debate.

Take a look at suburban and core urban growth based on 2000 and 2010 census data (via Richard Green). Suburban growth is walloping central city growth, even in cities with publicized downturn revitalizations like Chicago and Washington, D.C.


suburban urban city census.pngTwo ways I think about this. First, the past is not necessarily prologue here. The first seven years of the last decade were a housing bubble that inflated most dramatically in Sun Belt metro suburbs. Suburban growth looks dynamic because it was being fed by unsustainable demand for ever-larger exurban homes.

What's more, U.S. policy continues to support suburbanization over urbanization in countless ways. First, the U.S. has one of the smallest gas taxes in the developed world, which makes it cheap to drive 20 miles to work. Second, we subsidize mortgages more than most developed countries, which makes it cheap to drive 20 miles to work from your large home. Third, zombie zoning regulations make it difficult to build up in many urban centers, which restricts the supply of housing and office space, thus raising the price of housing and office space in cities. As Ed Glaesar wrote for The Atlantic, "Many of the world's old and new cities have increasingly arrayed rules that prevent construction that would accommodate higher
densities. If cities can't build up, then they will build out."

If it wasn't enough that our petro/mortgage policies are pulling Americans out to the suburbs, our city building policies are pushing families out of urban areas too.

URL to original article: http://www.builderonline.com/builder-pulse/housing-s-two-great-debates--own-vs--rent--and-urban-vs--suburban.aspx?cid=NWBD110302002

For further information on Fresno Real Estate, check: http://www.londonproperties.com

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