The Cost of Sprawl on Low-Income Families

Via the Manhattan Institute’s new blog, Streetsblog learns of a pdf-formatted report entitled A Heavy Load: The Combined Housing and Transportation Burdens of Working Famillies, which looks at the housing and transportation expenses paid by lower income families in a number of cities. The report, published by the Center for Housing Policy, a K Street think tank, finds that lower-income families in central cities spend significantly less on the overhead of life than suburban and exurban ones.

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Not only do urban families spend less on transportation, they are less likely to throw money out the window. In what the Manhattan Institute blog called "an excellent point," the report notes, "A three-car family puts a lot of money into depreciating assets, instead of into mortgages and college educations." Yes, like other consumer products, the automobile makes you feel good but offers a poor return on investment.

But to cut to the chase, the report concludes that among other things, governments should encourage infill development and work to reduce sprawl. As for why, it notes four trends that are likely to continue. Taken verbatim, they are:

  1. Housing and transportation costs are rising faster than incomes
  2. Faster job growth is occurring in the suburbs
  3. The U.S. metro population is suburbanizing, and…

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As the report stated,

A trip from suburb to central city no longer describes the typical commute in many metropolitan areas of the country. As jobs have suburbanized, many commuters make their way from suburb to secondary city or from exurban community to other employment centers in the region as well as central city locations. As these graphs show, the combined cost of housing and transportation increases with distance to employment centers. For Working Families living in neighborhoods far from employment centers, especially those in the $20,000 – $35,000 bracket, combined housing and transportation costs consume a particularly large share of income, with transportation costs exceeding those for housing.

So it’s better to live close to where you work. That’s what a dense city should do best, right? What does the report say about New York City?

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It is actually not a terrible place to live with a low income. Housing costs are higher than in most metro areas but transportation costs for working families — $7,880 a year — are the lowest of the 28 cities studied, making up for the higher housing costs.

In the New York City region, working-family households are more likely to live close to New York City where they can best take advantage of that region’s most affordable housing and superior public transit service. Relative to incomes, housing is most affordable in central city and older suburban areas, and least affordable in new communities near the suburban fringe. Working Families are consistently more likely to live in lower-cost and more affordable locations. New York City has the best public transit service in the nation, at least in four of the five boroughs. Beyond the city proper, the quality of public transit service to Working Family commuters vis-à-vis the private car falls off considerably, particularly disadvantaging Working Families in secondary central city and inner suburban areas.

As the costs of transportation increase with the predicted increase in the price of gasoline, it is likely that the financial advantage of living in New York City will increase. If more people try to make their way here, we would probably see, believe it or not, demand for housing even higher than it already is.

  • Clarence

    Very nice analysis and good facts. I also like to point out to “outside-of-NY friends” (who are always asking how one can afford to live in NYC) that there are so many other benefits to living here, things that do lower the cost of living.

    For example: No other place in the U.S. can you find free entertainment just about every day – quality events – outdoor movies, concerts, museums, etc! This summer was amazing, in Brooklyn FREE events were actually competing with each other for attendees.

    And I love being able to walk down a street and get a 25 cent banana nearly every block.

  • Just to build off of this important point AD and from one of the headlines in the daily round up, there is a shift going on among Metronorth users from suburbs going into the city for work to a growing proportion of low income workers living in the city (Mostly northern Manhattan and the Bronx) going back out to the surburbs for work:

    The depth of the changes on Metro-North was evident during a morning weekday visit of several hours to the Fordham station, at East Fordham Road and Third Avenue in the Bronx. The northbound platform for trains to places like White Plains, Chappaqua, New Rochelle and Greenwich was usually jammed with well over 100 people. The opposite platform, for trains bound for Grand Central Terminal, was virtually deserted by comparison. Part of the reason was that taking the subway is cheaper.

    This commuting pattern is the direct result of “unaffordable suburbs” both in housing and transportation costs. What we need are more communities with a diversity of income levels in relatively close proximity, linked together by good mass transit. This is something the suburbs are not good at doing (even if you let 12+ people live in a 3 bedroom house).

  • d

    “As the costs of transportation increase with the predicted increase in the price of gasoline, it is likely that the financial advantage of living in New York City will increase.”

    If only it were that simple. Unfortunately, the financial advantage of living in New York City is increasingly available only to the financially advantaged. Rich people want short commutes also, which is one reason for the gentrification of neighborhoods once thought to be undesirable to families and young professionals, such as the Lower East Side and parts of Brooklyn. The real estate bubble may pop in the suburbs, but with the increasing appeal of city living, places like NYC will become less and less affordable for the poor and middle class.

    Unless the city makes a concerted effort to provide affordable housing to all income levels, we are headed to a situation where the poor will be forced out of the city and increasingly burdened by the emotional, physical, and financial toll of car culture and traffic jams.

    The irony is that suburbs that were once built to accommodate those who fled the cities are now housing more and more people who would rather live in the city but can’t afford it.

  • J:Lai

    d, that is an interesting hypothesis.

    While there are elements of truth in what you say, I believe the vision of cities as exclusive places for the super-rich is a result of naively predicting current trends into the future with no moderating influences. The same type of predictions made in the 1970s and 1980s led people to expect that by the present day, cities would be completely overrun with hyper-violent criminals and squalid poverty.

    The reality is that these things to move back and forth in cycles. A large city can not function without a sizable population of lower and middle income residents. There is are large parts of NYC that are affordable for low and middle income people (although probably not enough), but these places are increasingly far removed from what we think of as the “city” – the lower half of Manhattan.

    The atomization of neighborhoods brings its own problems, however many of these problems could be solved by improved mass transit and re-zoning for denser residential development.

  • someguy

    1. If peak oil freaks are right, the suburbs of today are probably the ghettos of tomorrow, and the uneducated underclass will be the limited-mobility underclass

    2. J:Lai – that’s optimistic, and I hope you’re right. Simple supply and demand says that if cities become more desirable (like NYC), real estate will become more expensive, especially in desirable (i.e. convenient) areas (like NYC). However, supply and demand also says that providing more supply (of housing in this case), such as you suggest thru denser zoning, could mitigate the problem. Another solution this highlights and which I think is important is decentralizing center cities so that they have multiple satellite central business districts, all easily connected with mass transit. To their credit, this is a major part of the Bloomberg administration’s economic development strategy – bringing the jobs closer to the residential areas, by developing or expanding such areas as Downtown Brooklyn, Long Island City, Jamaica, Bronx Hub, and Flushing.

  • ddartley

    Wouldn’t it be good if studies like this got mainstream press once in a while? (Unlikely, of course, given the entertainment value.)

    It might inspire some Americans to rethink the destructive notion (drummed into our culture for decades, and supported by people like Robert Bruegmann as discussed on this site) that suburban sprawl is the result of a natural human tendency. In my uneducated opinion, it ain’t: it’s the result of many UNnatural things, especially the interstate highway system.

    Maybe if information like that in this study got out to a broader public, more Americans who don’t live near cities might realize that cities are better for the environment than suburbs, and that the real natural human tendency is to live close to other people, not separated by Chemlawns and eight-lane highways.

  • While I love to see studies like this one, it really presents no new information. See, for example, the book Sprawl Kills.

  • Nicolo Macchiavelli

    Regarding the reverse commute. I spent yesterday morning leafleting for a politician in the Brewster MN Station. Around a thousand day laborers disembarked at that station to shape up around Downtown Brewster. I was there for a couple hours, none of them got work. I assume some would have before the end of the day or they wouldn’t come back. I’m a very pro-immigrant guy. Still, if that is the foundation of the reverse commute market, and I’m sure it is a big chunk of it, how does that fit in with the affordability of the burbs? And, how does that market seem to grow with time?

  • ajedrez

    But if the poor fleeing to the suburbs causes a demand for cheaper housing, the housing stock will become more dense, and therefore, more transit-friendly.

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