Jonathan Hiskes

Making Smart Growth affordable

Jonathan Hiskes , Aug 06, 10.

Tagged with smart growth, walkable, location efficiency, mortgages, cnt, nrdc, mortgage

Let’s say you want to live in one of those fancy Smart Growth developments that green urbanists are always going on about. Let’s say you want to live in any neighborhood with transit service and a grid that encourages walking and biking.

Great. Living in a walkable, transit-connected neighborhood can save you money on gas and car maintenance, and maybe even eliminate the need for a car altogether. But it will cost you too, because housing in dense areas is pricier on average than housing in spread-out suburbs.

Mortgage lenders could help make walkable urban homes more attainable by offering location-efficient mortgages (more on those later)—but it would take a concerted effort from the Obama administration to make it happen.

The problem

The auto-dependent suburban housing style has dominated the nation’s home construction for the last ... oh, six decades. But research suggests only about half of Americans want to live in those subdivisions. A 2004 National Association of Realtors survey [PDF] found that 55 percent of respondents said they would prefer to live in Smart Growth-style neighborhoods rather than suburban ones. So while the supply of new housing in compact urban areas is low, demand is high.

“When you look at the supply side, even a town like Seattle has at best 10 percent of its housing stock in a walkable urban environment,” said Christopher Leinberger, a University of Michigan real-estate scholar and the author of The Option of Urbanism. “You’ve got huge pent-up demand and that pushes up prices.”

He’s found that walkable urban properties, on a square-foot basis, cost between 40 and 200 percent more than suburban homes.

Denizens of walkable neighborhoods could make up some of that difference by saving on car expenses. Consider that households in traditional suburbs spend 24 percent of their income on transportation costs, according to the Center for Neighborhood Technology, while households in walkable urban areas spend only 16 percent.

Full Story: How to make Smart Growth affordable
Source: Grist, August 4, 2010

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