Sprawl

Good article, I like Rybczynski's writing generally but it hardly points to a solution or indeed to the underlying problem. While scholars like Jane Jacobs have done admirable work in studying urban neighborhoods that operate on a reliably human scale, there is no similar study with plausible solutions to housing and community living to my mind done with suburban planning, unless its decisively negative. Instead we end up with the backward-looking, boutique communities of Duany Plater-Zyberk, which seem to be gated communities in sheeps' clothing. Levittowns had an increasingly negative connotation during the boomer years I grew up in, and I'll hazard a theory that this snobbism escalated out of control to the point that our status as homeowners would be determined by the degree of distance we could maintain from that idea and ideal of planning. Our thinking as citizens and members of communities has to change before we can accomodate ourselves to rational planning.

Posted by: Ed Olivera | 10/6/08

Thanks

Grreat article, Mr. Rybcznski. In response to Mr. Olivera, come see more TNDs with affordable dwellings, like Florin Hill here in Mount Joy. New urbanism is like our best answer for now. Remember, this kind of development is seen as risky by many, so it is still too difficult. The perceived risks often add time add costs which threaten the quality of the neighborhood. The gated-community effect seems to arise from the homeowner's associations often indirectly required by us local officials. The widespread use of HOAs may be a short-term benefit to municipalities now but could cost the residents of them over time. Moreover, these HOA residents may someday fight getting double-dipped by HOA fees and local taxes and fees for the same services.

Posted by: Mark Hiester | 10/6/08

Code conspiracy

Codes come as another big factor in construction costs. Imagine designing, marketing and then producing a product requiring substantially different design specifications, building methods, and a material every time the product crosses a political boundary. In other words, require automobile manufacturers to build to different specifications in every city and county across the USA and auto prices will climb. Build the same house in regions as close in climate and geology as Iowa and Nebraska and you must walk through a gauntlet of local regulation and code interpretation; usually at the hands of a magisterial code enforcement official bent on imprinting construction in his little patch of the prairie with his private peeves and without regard to cost, consistency and sometimes even modern engineering. We have a fairly uniform electrical code that allows most electricians to work without having to dramatically change their approach from town to town. A truly international building code that applied at least through regions with similar hazard categories would help homebuilding companies grow and export their tried and true products at least from county to county, if not nationwide, without the enormous cost and learning curves associated with learning the idiosyncrasies of every township in America.

Posted by: Fernando | 10/7/08

Bubble Economics

"So what’s keeping housing prices high?" The first three-fourths of the essay is interesting and informative. Thanks very much. But why, even as we sit looking at the back-end of an enormous housing bubble, would we persist in the presumption that housing prices are based essentially on adding up costs? Because we can assume the markets are so perfect as to require it? That's not analysis, that's market fundamentalism. The greater rise and crash in the less-regulated housing markets like Las Vegas, while housing prices rose more slowly (and are lowering more moderately) in places like Oregon, belie a simplistic blame game. Homebuilders are far from being the victims of elitist communities. They have lobbied hard, locally, state by state, and nationally through the NAHB, to maximize the availability of the larger lots on which they could build McMansions - largely because, much like their mobile equivalent the SUV, the profit-margins are easier, and also because decades of tax and labor policies that have redistributed wealth upwards make the upper-end market additionally attractive. A more balanced treatment (if also imperfect) treatment of the complex relationship between zoning regulations, housing value, and housing prices, done for the Brookings Institution, is available here: http://www.smartgrowthamerica.org/growthmang.pdf So what’s keeping housing prices high? A runaway speculative bubble - not the actual costs of new houses - land included - which were left behind as far back as about 2002. Prices still have quite a ways to fall to hit the costs of new construction - which, real estate economists suggest, tends to provide a floor for housing prices, not their peak.

Posted by: Kevin Matthews | 10/7/08

Levittown/American Dream Still Alive

Rybczynski rightly points the finger at overly zealous regulation as a principal reason for the escalation in housing prices. Missing, however, is the fact that the American Dream as embodied in Levittown is still alive where regulatory excesses have been avoided. Rybczynski notes that Levittowners could be purchased for three times the average wage. The average wage in 1950 was virtually the average household income, since there was rarely more than one worker in a household. In much of the country median house prices today remain at or below three times median household incomes. Notably, these are areas where smart growth style land restrictions have not taken hold and it includes metropolitan areas like Atlanta, Dallas-Fort Worth and Houston --- the three fastest growing metropolitan areas in the developed world over 5,000,000 population. In all, at the peak of the housing bubble, 46 of 129 US markets had house prices at or below the Levittown ratio (see 4th International Demographia Housing Affordability Survey, http://www.demographia.com/dhi.pdf) --- such as Kansas City, Columbus, Des Moines, Indianapolis, Louisville and other metropolitan areas that are generally recipients of domestic migrants from the more highly regulated and unaffordable markets. Moreover, the median sized house is at least double the size of the Levittowner. Finally, new starter homes can be found at or below the Levittown ratio in many of these markets. Wendell Cox Co-Author, Demographia International Housing Affordability Survey Demographia, St. Louis & Conservatoire National des Arts et Metiers, Paris

Posted by: Wendell Cox | 10/9/08

stagnant wages

the missing the plain fact is that americans haven't had a real wage increase in more than 30 years. since the 1970's wages have been stagnant while the price of everything else has increased. even families with two working adults haven't kept pace with the growth trends in the generation after WWII. all this despite massive productivity and overall national income gains. what all this means is that the comments here, which focus on land use regs, HOAs and, design are misplaced. their impacts are on the margins. the heart of the issue is that we've been ripped off for more than a generation. we need rebuild the social compact and reclaim our fair share of the national income. lets hope that an obama administration and the collapse of the laissez-faire economic dogma allows us to do things differently.

Posted by: alex | 10/9/08

Here in Houston

Here, in the United States' fourth largest city, Houston, we do enjoy affordable homes and have largely resisted the destructive effects of the housing downturn. In Houston, firefighters, police officers and teachers live close by CEO's, rocket scientists and world class heart surgeons because of our long tradition of rejecting centralized land use controls. We are, in fact, the largest American city without zoning and home prices are a modest mutiple of median incomes. We believe that every citizen has the potential to join the elite "creative class" and that exclusionary land use controls simply drive up real estate prices and price the lower and middle classes out. Instead, we believe in opportunity driven by consumer demand and our healthy growth and affordable prices have made mortgage tricks to put people into homes they can't afford, unnecessary. We have a healthy and divesified economy and are just now seeing some of the friction between greater denisty within our core city and continued growth that has bedeviled urban officials the world over. But as H.L. Mencken once wrote, "For every complex problem there is a simple solution--that is usually wrong.." we plan on again rejecting the few voices here that are now advocating distortions of the market through centralized land use controls. Prudent planning is, of course, necessary and valuable but for public expenditures in support of consumer choices, not for regulations that require private capital expenditures in ways that defy consumer demand. Our affordable housing, robust job market and divesified economy all contribute to giving Houston among the best race relations of any major city in the United States. People here, of every background, believe that it is possible to get ahead and to live a good, productive life. With a third of our city Anglo, a third Hispanic and a third African-American, we believe that our local government policies in support of consumer driven growth have made us a leading "opportunity city". We certainly want pedestrian oriented development and other new urbanism ideas to be given a fair chance here--just so long as the consumer decides their value instead of by government fiat put forward by well-intentioned people who just don't have a very good record outguessing the dynamic market. Government supporting consumer choices has worked pretty well for us here in Houston and we're ready to fight those who promise utopian outcomes for centralized controls that just never quite work out that way--and which commonly hurt a lot of people.

Posted by: K Hoagland | 10/9/08

Glaeser & Gyourko misrepresent the situation

It is not really case of selfish NIMBYs cooking up onerous regulation to keep people out of the Northeast and California. It is the simple fact that we don't have any more potato fields twenty minutes outside of the city. Glaeser would have have us pave over every last inch of grass left.

Posted by: Greg | 10/10/08

Houston and the "dirt gap"

The pro-Houston position finds support from the already-cited economist Ed Glaeser, writing in City Journal: "Houston, New York has a problem" http://www.city-journal.org/2008/18_3_houston.html See also Steve Sailer on the "Dirt Gap": http://www.isteve.com/2005_Dirt_Gap.htm

Posted by: BenjaminL | 10/10/08

houston zoning

Houston has defacto zoning through minimum parking standards both for residences and commercial development that effectively dictate traditional automobile oriented sprawl. Houston and Dallas largely remain cheap because they aren't hemmed in by oceans, great lakes, rivers, mountains (New York, Boston, San Fran, LA etc,) or other natural barriers.

Posted by: chris | 10/16/08

Dual Income Economy

For some time, I have contemplated another answer to Witold's question,"So what’s keeping housing prices high?". I am not an expert in economics but I believe that the economy has evolved and product costs have increased adjusting to the purchasing power of dual income families. If this is true, then perhaps the cost of todays affordable house is in line with the inflation figures quoted here if you consider the average annual income as a household (dual income) figure. I realize that this is a general assumption as I am not arguing how single buyers factor in. I will not argue his comments on higher costs of land, though. In the Colorado Front Range, we are forced by the jurisdictions to design and engineer the land far above and beyond the Levittowns. The design costs coupled with the costs for the review and approval process push home prices above the "affordable" mark. It is no wonder that the lending industry progressively loosened to keep the market moving.

Posted by: Dave Boyle, Assoc. AIA | 10/17/08

Construction costs

You lost me at $30-40/sf for contemporary construction costs for a home. Here in Seattle, the cost for building a no-frills spec. home (not including land cost) starts at about $150/sf. Where did your cost figures come from?

Posted by: David Neiman | 10/19/08

Affordable house

The problem is well defined and researched by Mr.Rybcznski.It is true that the unaffordability of a house, specifically in metropolitan cities in India is due to high cost of serviced land. Even this cost is not the real cost of servicing the land but the "speculative opportunity cost" of serviced land. The present per square foot prices of apartments in Mumbai for example range between Rs. 65,000(approx. 1413 US $)at Colaba-southern most tip of the island city- to Rs.1400(approx.30.40 US$) at Vasai the northern suburb a variation of almost4648%! Not surprisingly the cost of construction at the two locations for similar specifications varies by hardly 50%. The key to affordable housing is therefore the availability of serviced land at affordable prices rather than the construction cost.The Government has addressed the issue by 1 Reducing the size of a house to as low as 225 sq. ft. of carpet area. 2 By making such houses available to the lowest income groups at cost of construction. The result is that the occupants, despite various legal constraints, manage to sell the apartment at the market rate earning a profit of anything up to 2000%! So long as the opportunity cost of land in cities like Mumbai is much higher than the real cost the so called affordable housing will ultimately be taken up by the rich. A possible remedy lies in not reducing the cost of construction or size of a residential unit but reducing the opportunity cost of serviced land by making the metropolitan cities less "attractive' for the speculators. Rather than architectural or engineering solutions an urban planning and strategy has to be devised to make affordable housing a reality.

Posted by: Prakash M Apte | 10/20/08

More regulations = Less Affordability

The International Code Council just adopted a rule that will require in-house fire suppression (sprinkler) systems in all new single-family residences. They adopted it after heavy lobbying by the fire sprinkler industry (surprise, surprise). This will add a few thousand dollars to the cost of a new home. Now, surely, no-one is in FAVOR of people dying in house fires, but - at some point in time - we have to weigh "protections" against affordability. If we want the latter, we have to say "enough" to the former. At the very least, we have to quit pretending there is no connection between the two.

Posted by: Blue Light | 10/24/08

Glorious People's Housing Soviet

Alex needs to tell me quickly what kind of house I need. After one serious property tax increase, my mortgage comfort is pinched. After another, whether to pay for unpopular light rail or living wages for lifeguards, I'll be forced to move if that government check isn't big enough.

Posted by: Dr. Johnson | 10/29/08

housing costs

land is only part of the reason for high housing costs. others include real wages not keeping up with inflation for most working and middle class people. construction firms make more money selling a mcmansion than a sensible bungalow or tract house. banks reap huge profits as well. sorry, but there are no bailey buidling and loans these days. urban neighborhoods have become extremely trendy and targeted by affluent professional types and trust fund babies who artificially keep the price of housing inflated to leave out lower income people and other 'undesirables'. the nimby factors plays a role as well in excluding minorities and other groups of people not wanted in the neighborhood without showing actual signs of overt discrimination that could be challenged in a court of law. then, there's the greed factor. big houses cost more than little ones, and developers make a heck of a lot more money from them. lenders, of course, make much more loaning 500k than 100k. dual income earners play a big role as well. the current housing economy is simply not designed for the single wage earner or anyone making less than 100k annually. and if you're not professional and degreed in certain fields (business, healthcare, engineering or big pharma), you're simply not going to be permitted into the housing market, at least not in the better areas. urban centers, such as chicago, in an attempt to make up for lost tax revenues due to its eroded industrial base, must find ways to gentrify neighborhoods and lure high-end hoteliers, restaurants, salons and services that pander only to the 'right kind of people'. the majority of urban dwellers, especially those in older and poorer blue collar neighborhoods, simply do not fit into this modern urban equation, and therefore, are easily dispensed with and promptly relocated to far away, often job poor regions of the metropolis. overall, rybczinski's article is limited in scope, neo-liberal in economic focus and inoffensive. it rocks no boats nor does it provide any viable alternatives to the current economic madness and mean-spiritedness we have endured this past quarter century.

Posted by: emmbee | 1/5/09

What to Do

We have been kicking around the idea of how to design a home that would be affordable to build and efficient in its use of resources and space, but remain a comfortable and modern dwelling. In addition we were wondering about it also being able to adjust to any way of living or to changes that your life brings. Especially during the current economic crisis it is of concern to how to build a house that I can afford right now, but is able to adjust when my income is going to grow again and become more stable or my life style changes. We started dubbing it jokingly the IKEA house as we have been working along at it. We are confident that we came up with a few good ideas and are about to debut it on our website at www.dialectdesign.com. Hopefully it will be a viable option for a lot of folks, who need an answer soon.

Posted by: Toby Witte | 4/1/09

here's why we can't...

because the wages in this nation have basically stagnanted under the republicans trickle down economic, the average price of a home has sky rocketed as material costs went up. That is due to everything being shipped over seas to maintain the suicidal growth of the chinese economy. you want an affordable house? raise wages to stay in line with the cost of living. period. but in this nation, we reward the rich for??? (I'm still trying to figure that one out) keeping all the money via massive tax cuts? Please someone explain to me how we are better now after 30+ years of trickle down economics? our current state of affairs is living proof of it's colossal failure. You want affordable housing? cut the corporate welfare. Hold these do nothing golden parachute ceo's to task for their continued ability to fail up the corporate ladder. Take away their disgustingly high salaries and spread the wealth to the masses who actually do the buying and driving of the economy. Do you know that the average 2% wealthy at the top of the economic food chain only pay 17% of what they paid in taxes in 1955? Think about that? and that was under a republican president!! And they whine now? No wonder our nations infrastructure is a massive mess. do you know that in 1965 the average ceo made 6 times what his average in employee made. do you know what that is today? over 476 times. 476 times over his average employee!!! it was a slow rise but really took off after nixon was elected then sky rocketed after reagan. I know I know, facts, stats etc, those are reality based numbers. Who needs that when wonton emotion rules the day. Like I always say, why ruin a good lie with the facts. we live in one truly bizarre nation.

Posted by: Thomas Jefferson | 5/13/09

What about an affordable HOUSING SYSTEM?

Well I gotta say I liked Mr. Rybcznski's article...but I really liked the well thought out responses as well. So here's where I add my two cents... DIVIDE & CONQUER! If you don't want people creating powerbases (communities) that have enough members to stand up and say "NO!" (to being ripped off by the system) or gain the ability to solve problems on a local level (instead of running to the government)...you just regulate these annoying little insect communities away with draconian building codes and zoning regulations. Now you have a socially engineered America where the people don't realize how they're being denied the fruits of their labor...or how the government and the corporations (and those in positions of power) are USUFRUCTUALLY SUCKING THE LIFE OUT OF THEM BY DENYING THEM SAFE ALTERNATIVES TO OVERPRICED CRACKERBOXES! All that being said... Inbetween WINNING and LOSING is GAMBLING! Gambling is a scam because forcing a resolution between WINNING and LOSING induces and endorphine rush that can become addictive. Inbetween OWNING A HOME and NOT OWNING A HOME is...(drumroll)...RENT! RENT is a SCAM! Rent is what you pay a motel owner for a clean bed and phone for a few days. Rent is not paying through the nose (to Mr. Potter) for something you will never own or have a stake in...or the temporary community you find yourself in. Watch the movie 'It's A Wonderful Life' one more time for effect. I spotted the affordable housing and lack of community issues years ago. I designed beautiful, stackable, hex-shaped modular housing that anyone could afford...which is far better than apartment renting or scalding condo payments. The result?... Engineers, architects, consultants, city planners all either laughed in my face or stared in disbelief. "You're trying to buck the system man! You can't do that!" Affordable housing is a Golden Calf...a no-no...NO TOUCHY!...because it promotes the formation of unsanctioned POWERBASES/COMMUNITIES that would retake power from the greedy corporations (that want all the benefits of a working community but none of the responsibility) and would, in short order, tell the government to stuff their self-serving laws back where they got 'em!. So eventually I wised up...I gave up...I moved on to solving bigger problems...like what causes gravity? (Simple...the Bernouilli Principle...but you didn't hear it from me!) Cheers!

Posted by: GarthFromSeattle | 7/5/09