You Got to Be Kidding Me!

Car Sharing Actually Works?

Posted in Four Wheels, Mass Transit by Stacy McMahon on March 29, 2005

You probably remember when ZipCar and FlexCar came out a few years ago. It seemed like an interesting idea, but you wondered how it could actually work. Even if someone made a genuine effort to use only the shared car for necessary trips, it would be hard to actually give up their personal car–what about emergencies? If you need to go to the ER, and there’s no FlexCar available, you’re in a bad situation. You might take that chance yourself, but if you have a family are you going to put them at risk?

I figured most people would end up hanging onto their own cars, and realize eventually that the car sharing is of no benefit when they’re already paying for a vehicle that they aren’t going to get rid of.

Turns out that’s not the case. And the car sharing companies are booming in a very unexpected area: the Los Angeles-like sprawl of the Washington, DC suburbs. The article is vague about the circumstances of the individuals who have taken the no-car plunge, and there seem to be some modest government subsidies involved (especially in securing parking spaces for the shared cars) but apparantly smaller companies that can’t afford to own a fleet of cars are taking advantage of the car sharing companies’ economies of scale. Which is more encouraging in a way, since it ought to allow businesses to function better in the inner suburbs, instead of running for the momentarily uncrowded edge.

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Housing Prices, Cyburbia and Development Regulations

Posted in Economics, Urban Planning by Stacy McMahon on March 22, 2005

Just from the topics in that title, this could be a book. I’ll try to keep it down to post-length. A thread on the Cyburbia forums cited an article in The Economist (requires a premium subscription, so I won’t bother with a link) that blames development regulations for high housing prices in the West’s most successful cities. The user who started the thread blamed planners for the regs, and thus the affordable housing crunch. A couple of points bear answering.

First, the development regulations that cause housing shortages are the same ones that cause sprawl, and they’re substantially not the planning profession’s fault. In [most] planners’ ideal worlds, the landscape would contain a series of compact towns and cities. These urban enclaves would have office and industrial space to support their economic activites, a dense downtown featuring sidewalk cafes, stores and other businesses with dwellings extending some number of floors above, and a series of surrounding neighborhoods with townhouses or single-family homes on small lots lining a compact grid of streets. Sprawl-free farm, forest and parkland would line the railroads and highways between towns. If you’ve been to Europe, or Oregon, you’ve seen what this would look like.

Local residents, presented with such a plan, usually feel that their pristine small towns and subdivisions are under threat of being replaced with heavy-duty city streets (and all that that implies). So they respond by arguing the zoning down to two houses per acre in town, and 20 acres per lot out along the highway. At this point, all the people who would have lived and worked in the town if it were built up have to go another 10 miles down the road to find a subdivision to live in. The process both increases sprawl and drastically limits the supply of housing, resulting in price spikes. If they’d done it the planners’ way, a lot more people would live more affordably in a smaller footprint, without covering the countryside in half-acre lots for 60 miles around the city.

Second, the responses in the thread show an alarming lack of knowledge of basic economics among planners (or at least those who subscribe to Cyburbia). Almost nobody mentioned supply and demand, even though the article names constriction of supply as a causal factor in high housing prices. Some blame sprawl itself, as if the mere fact of placing a subdivision miles instead of blocks away has any substantial effect on the cost of building it. Others try to put a 100%+ increase in real-dollar cost down to updated materials, or building codes. The same codes apply, and the same materials are used, in places with slow growth where housing costs literally half as much as in a hot market like Washington. I’ve mentioned before that the planning profession has a decidedly mixed reputation with the public whose habitat we presume to design. Getting smarter about market forces that, after all, have an enormous effect on the work we do would be a solid step in the right direction.

Ever Had A Horizontal Condo in Toronto?

Posted in Urban Planning by Stacy McMahon on March 17, 2005

Here’s an interesting idea–take the extended backyards of older narrow-lot houses with back alleys, and build lowrise condos with underground parking (for both the houses and the condos) along the alley. You get a whole extra set of streets (presumably trash collection is curbside, not through the alley) and the equivalent of at least one granny flat per house. It wouldn’t likely fly in most of the suburban US, where potential crowding is considered a bigger problem than sprawl, but it might at least get a polite hearing in Chirilagua.

As California Goes…

Posted in Politics by Stacy McMahon on March 11, 2005

…so goes the nation? The Christian Science Monitor says California will make it easier to build homes: (hat tip: Planetizen)

“We’re near a tipping point for public policy,” says Duane Bay, a housing consultant in East Palo Alto, Calif. “There is broad consensus that we have to build additional housing.”

[…] The median home price in the San Francisco Bay Area, traditionally the costliest market in the nation, stands at $666,740, according to the California Association of Realtors.

The Golden State has a storied history of taking dramatic steps to preserve the single-family home as the dominant standard of housing. The problem, of course, is that much of the state, especially southern California, is already built right out the edge of the mountains. With so few options for greenfield development, are we about to see a new massive wave of infill and redevelopment in the LA basin’s old city centers? Maybe. Resentment of traffic and the time wasted in long commutes is also gaining steam across the country. With the right regulatory environment, that could lead to density increases at major nodes, eventually making larger regional transit networks viable again.

Also in the LA Times: Suburbia Takes Shape in Imperial Valley

Posted in Urban Planning by Stacy McMahon on March 7, 2005

It strikes me that this is also one of the big reasons why “town centers” are popping up in greenfield exurban subdivisions:

After three years of renting, the couple paid $226,000 in January for a house in an El Centro subdivision where grass has yet to be planted on all the lawns.

“We were never going to be able to afford a home in San Diego,” said Ramirez, who now works at El Centro Regional Medical Center.

Who says these folks don’t want to live downtown? They just can’t afford it–so they move where they can afford to, and later bring a little bit of downtown with them. Didn’t we used to assume that suburban residents specifically didn’t want to see the city following them out there?

A Kelo Update – More Strange Bedfellows

Posted in Politics, Urban Planning by Stacy McMahon on March 6, 2005

There isn’t a lot of news out of the SCOTUS arguments yet. Several op-ed columnists and editorial pages have weighed in, all predictably on the side of the little guy. More interesting is the list of amicus briefs filed in the case, which has some distinguished names on it. Jane Jacobs has this to say:

See, e.g., JACOBS, DEATH AND LIFE OF GREAT AMERICAN CITIES […] (describing massive harms inflicted on poor neighborhoods by the use eminent domain in urban renewal programs). Indeed, amica believes that the clear-cutting of neighborhoods like Fort Trumbull is antithetical to the development of healthy, vibrant mixed-use communities she espouses.

NAR and the NAHB have weighed in on Kelo’s side too:

[…] NAHB recognizes that housing will almost never afford a community with the economic development benefits that a commercial application will. If economic development as a sole justification for public use is decided using a rational basis test with deference to local legislative bodies, then the door is left open for local governments to abuse their eminent domain powers and take developable land from NAHB members as they could from any other property owner. Therefore, NAHB must adhere in this case to its long-standing objective to protect private property rights from abuses by local government.

Of course the housing in the proposed project is just a sideshow to the economic development piece, which is the Pfizer research headquarters. It’s hard to argue that that won’t bring a lot of new money, and new blood, to the city.

John Norquist of the Congress for New Urbanism argues that not only can redevelopment easily occur without condemning property, but that taking away the tool of eminent domain will help weed out marginal projects:

Moreoever, where government wishes to stimulate economic development, there is a vast array of development incentives available to accomplish that without resort to the lend-lease of its eminent domain power for land assembly. Such speculative over-use of eminent domain may actually have a chilling effect on the rigorous economic screening of projects naturally occurring in the private marketplace, and may result in an increased number of unsustainable development projects.

I don’t know Norquist’s politics, but I wouldn’t be surprised if this near-full throated cheer for private markets is a little jarring to parts of his social circle. Anyhow, it’s not every day that you see Jacobs, the NAACP, AARP, or the Farm Bureau Foundation in the same trenches with Cato, the Reason Foundation, Goldwater Institute or the Property Rights Foundation (among others). Apart from NAHB, it’s not too hard to see why most of those would oppose the Fort Trumbull project. It’s neither old-style festung downtown nor real new urbanism. Nobody’s likely to be emotionally invested in it, though they’d be smart to be financially invested; from the description it’s exactly the kind of 3/4-assed ‘new urban’ infill that’s blazing hot in Washington, Atlanta, and other major east coast suburban environs.

Which may explain the most interesting name on the short list of briefs opposing the plaintiff: APA:

Eminent domain is concededly an unsettling power, and is subject to misuse or overuse if not properly constrained.

But they call the petitioners’ interpretation of ‘public use’ a “novel and restrictive approach” inconsistent with longstanding legal interpretation. I don’t know enough to say whether that’s a tenable position; my impression is that there is legal precedent for condemning non-blighted property in order to redevelop it, but that it isn’t very deep or longstanding in the scheme of things.

Strange bedfellows indeed…

More on Kelo v. New London

Posted in Politics, Urban Planning by Stacy McMahon on March 2, 2005

The Fort Trumbull eminent domain case goes in front of the Supreme Court. The defense seems to have picked a salesman to argue their case, while the plaintiffs have made what are probably some strange bedfellows in arguing their case.

What’s the case? Well, that’s the main point of argument. The short version of events is that the city is attempting to condemn an older residential neighborhood in order to allow Pfizer to build a new research headquarters. To dress it up, they’ve also added a standard-issue “new urban” retail/condo development with a gym and marina. It’s not a bad plan, since Pfizer will most likely bring in people from outside to fill most of the high-skilled jobs at its facility, and those employees will need upscale digs to call their own. Problem is, the owners of 15 houses in the neighborhood don’t want to sell. There’s no crime problem, nor any extroardinary urban decay, and they like it there just fine.

The city comes back with the argument that the neighborhood is blighted, or well, not really blighted but in decline, and could be blighted …one of these days. Anyway, they’re just trying to do something about it, poor public servants of an economically depressed city, and here’s this great opportunity for comprehensive redevelopment! To back them up, they’ve trotted out Berman v. Parker (1954) where SCOTUS found that the use of eminent domain to take “blighted” land and turn it over to a private developer was constitutional. Prior to that, “public use” meant things like main roads, railroad tracks, and bridges–public infrastructure built by, and making a profit for, private corporations. Kind of like downtown redevelopment.

Exactly how much like it is the rub here. If every public use also involves private profit, then on what basis do we say a transportation project is more legitimate than a residential redevelopment? Public housing replaced blight with liveable, humane housing for innercity residents [before becoming blighted itself] and that’s legally a public use. If ritzy condos and a gym might attract upscale residents and kickstart the local economy, does that make it one too?

(links lifted mainly from Planetizen)

The Housing "Bubble"

Posted in Economics, Politics, Urban Planning by Stacy McMahon on March 1, 2005

Michael Kinsley expresses his opinion that the real estate market is in a bubble that’s likely to pop any day now. Maybe. Well, who knows really?

It is obvious to me that today’s real estate prices are a speculative bubble that is bound to burst. Of course, this has been obvious to me for about three decades and wrong almost all of that time.

Points for clever CYA. Of course, it’s hard not to wonder what’s going on when housing prices double in five years. Not so long ago, an increase like that took 15 or 20 years, and that was if the area near your house happened to get a lot of new development that made it popular.

The New York Times also must be talking to experts. “In Housing Sales, Frenzy is Giving Way to Balance,” it says. And it reports from suburban Westchester County that “Housing Market Is Still Going Strong.” In 2004 the median sales price rose from $564,000 to $645,000. “More and more families are seeing the residential real estate market as the best and safest place for their money,” a real estate agent says.

Maybe he’s onto something. I don’t know about you, but I know a lot of people who are convinced they’re smart in real estate investment. Their evidence? They’ve sold a couple houses in the last three years and made a killing. In the stock market, the short sellers start smiling when every Tom, Dick and Harry thinks they’re Warren Buffett. On the other hand, people need a place to live, and the population is still rising, especially in the hottest housing markets. So the other possibility–which Kinsley doesn’t get around to–is that supply still isn’t meeting demand. How could that be, when there’s obviously so much money chasing four walls and a roof? Consider:

  • The size of the average household is going down, especially in the DC area where there are a lot of young singletons who can (or at least could, five years ago) afford a house. These people are buying real estate as an investment, and they don’t follow the traditional path of getting married and having one or more children before moving to green acres.
  • Most local jurisdictions have artificially limited supply by enforcing low minimum densities for the land area that they allow to be built. And most infill or downtown redevelopment is targeted to the extreme upper end of the market. Some recently announced condos inside the beltway are going for over $300,000 for a studio.

Ultimately, the result seems to be leapfrog development. If you can’t find a house you can afford between Route 28 and Route 301, then you can either keep renting, or go out to west Virginia, western Maryland, or Pennsylvania to buy. With that kind of sprawl, it just might be that our version of midtown Manhattan now extends to the Beltway and beyond, and our Jersey City is now in Stafford County, or Westminster.