8 ms·

Urban Density and Home Prices

76 points by luu 3y ago

deleted 3y ago
[deleted]
kj4211cash 3y ago
Well written and fairly convincing. Slightly off topic but the side point about highway capacity expansion projects interests me. I’m guessing it won’t be popular. But it’s true that more people are traveling and choosing to travel despite the congestion. I’ve never heard the urbanists so quick to dismiss such projects address these points.
- bobthepanda 3y ago
  The issue from an urbanism perspective is not really that highways fill up immediately. The problem is generally selling capacity expansion as "reducing congestion" when it does nothing of the sort. That, and the capacity gets used so quickly that you are very quickly spending yourself into a hole trying to build ever more highway capacity. The thing about a train is that it's very hard to make it so crowded the service degrades due to congestion, at least not within the first 20-50 years. This black hole of money needed for highway congestion then starts pulling away from other municipal and transportation funding needs.
  - kj4211cash 3y ago
    But that's true of public transit projects too. They always promise to reduce congestion and never actually do. Congestion charging is probably the only way to really reduce congestion and in many ways the solution is worse than the problem. And, more than not being a problem, the highway filling up immediately is actually a benefit. Because more people are able and are choosing to travel, to accomplish whatever they need and want to accomplish. Granted, the externality costs of all that car travel are high. But that's almost a separate issue and one that we really should be solving by a better accounting of costs and additional taxes. It's a shame that won't happen.
    - bobthepanda 3y ago
      It doesn’t reduce road congestion but it does reduce transit congestion. The Second Avenue Subway, for example, decreased loads on the parallel congested Lexington Avenue line by 11%: https://www.6sqft.com/in-just-a-month-second-avenue-subway-eases-congestion-on-the-lexington-avenue-line-by-11-percent/ https://www.6sqft.com/in-just-a-month-second-avenue-subway-e.... It’s displaced 88,000 trips a day, and yet it’s not anywhere near full; a highway expansion would struggle with that amount. Traffic speeds generally have a floor of how long the equivalent public transport journey is. (If the public transport journey is faster, people will use that instead.) The issue now is that American land use is so out of whack it’s hard to deploy transit widely enough to make that true for the majority of trips.
      - kj4211cash 3y ago
        I think you're on to something with regards to subways in urban environments moving a number of people that a highway expansion would struggle to match. Feels to me like movement of people should be the real metric and, given that, that we should be prioritizing transit investments in places like NYC, San Francisco, and West LA (as opposed to light rail to Azusa). Downs-Thomson Paradox is also interesting here and relates to your second paragraph. In a built out environment, transit trips and car trips will take roughly the same amount of time, door to door. Transit advocates have used that finding as a way to complain about road projects, but I think it actually is a much more interesting finding that suggests a more multi-modal approach to planning. I wonder how relevant or irrelevant it is for non-built-out environments.
        bobthepanda 3y ago
        In the US at least, really the complaint from transit advocates is that funding is and continues to be overwhelmingly road-centric, with a small share for transit and basically a pittance for walking and biking. Usually the issue with suburban transit investment occurring over urban ones is that urban areas are so weak they cannot fund expansions by themselves, and if you want the suburbs to pony up they’ll get their pound of flesh
  - cwalv 3y ago
    It'd be interesting to think about ways we could implement congestion control on highways .. every thread I've read implicitly assumes it's not possible
    - bobthepanda 3y ago
      You have to limit demand, which is unpopular, because no one wants to be the one on the losing end of a ramp meter or a toll.
- throw3823423 3y ago
  The problem of the highway expansion is not damage done by the highway, or that the highway itself doesn't increase value for land far away: It's that the very subsidized highway later gives us horribly inefficient land uses which don't pay for themselves. So yes, the widening of the highway makes the suburb more valuable, but the second effects make the city spend more resources on parking and makes the streets worse for anyone nearby. It's no picnic for the suburb either: A car-centric infrastructure basically bans anything else. That would be fine and all, if ultimately it produced more value than the alternatives. But look at the parking lots that were designed to never get completely full on black friday, back when it was actually a time where people did local shopping. Nowadays it's all wasted infrastructure, expensive to redevelop. If you thought that the commercial real estate office in dense cities was in trouble, don't look at the one in suburbs. So it isn't really the highway, but all the things that relying on the highway leads to.
  - throwaway173738 3y ago
    Not to mention how loud highways are. A concrete freeway generates enough noise at rush hour to make conversation impossible a quarter mile away. Nobody who lives nearby spends any time outside.
- Karrot_Kream 3y ago
  Urbanists don't like highways because highways are generally sold to the public as a way to reduce congestion; what usually happens is the extra lanes fill up immediately. The capacity of a train is much larger and it's a lot cheaper to increase throughput on a train line (by running more trains, longer trains, etc) than it is on a highway.
- pickovven 3y ago
  Urbanists disagree that more VMT is inherently good. VMT is good because of why people make trips - see their family, go to work, shop etc. The alternative isn't eliminating those trips. It's taking the trillions of dollars we waste and spending it on an alternative, more efficient modes that deliver better outcomes (travel time, cost, speed, comfort, etc)
  - kj4211cash 3y ago
    I agree that VMT is good because of why people make those trips. If you're saying spending all that money on public transit would be a better way to help more people make more of those trips, then you'd be unequivocally wrong in much of the US. Go to someplace like Dallas and marvel at the nearly empty buses and light rail run cars. Maybe we could focus on dramatically improving public transit in someplace suitably dense like West LA. If only the politics allowed it.
- jltsiren 3y ago
  Most people don't object to increasing rural highway capacity. However, the increased traffic has to go somewhere, and nobody likes busy streets in their neighborhood. Not in the suburbs, and not in the city. People generally want less traffic in their area, not more. Urbanists tend to prefer walkable cities. They want to use less above-ground space for traffic and parking, leaving more space for buildings, parks, and public squares. Highway capacity expansions work against that, because they encourage more people to drive into the city.
- JambalayaJim 3y ago
  Urbanists don't view the fact that more people are choosing to travel as good, because of the destructive effects of that travel (noise, pollution, parking, etc.)
- rr808 3y ago
  I've lived in European cities and American cities. American cities are more car centric and its actually more convenient. Many cities in Europe are so congested and difficult to drive but its by design rather than a bug - it means people are more likely to get trains to get out of town. I do see that more roads encourages more cars and driving, I've found it to be a good thing.
  - bobthepanda 3y ago
    Car dependency generally results in negative health outcomes though. * driving is just less healthy than walking, biking, or walking to and from public transport * driving causes high noise pollution and emissions; EVs will solve the latter but not the former, since above low speeds most of the noise is tires rolling against roads * increased driving in the US has led to higher fatality rates for the people still walking and biking * increased driving leads to lower funding levels for other types of transport since road infrastructure is so expensive, and not everybody can afford a car to avoid getting left behind
    - rr808 3y ago
      Great! Well I moved from Europe to the US, and I'm not going back.
rcpt 3y ago
The graph is misleading. Sure Manhattan is expensive but you can easily find a 2 bedroom in Jackson Heights for under $300k and still take the F train to work in the city. In the Bay Area that price point will have you on the freeway 4+ hours every day.
- Aunche 3y ago
  >you can easily find a 2 bedroom in Jackson Heights for under $300k I agree with your overall point, but home prices are somewhat misleading in NYC. The "affordable" places tend to have lots of fees. That $300k 2b in Jackson Heights that's within walking distance to a subway line is probably going to have a $900 HOA.
  - sologoub 3y ago
    HOAs in CA are frequently above $500, so the $900 HOA won’t skew the payment that much, plus you also have to account for amenities included in the HOA. CA HOA amenities tend to be fairly light and building/lot maintenance focused.
  - navaati 3y ago
    Beg your pardon ? After you have sunk all that capital, you still have to pay an amount that's basically equal to a (small) rent ?
    - rcpt 3y ago
      Yes.
    - TheCoelacanth 3y ago
      Have to pay for maintenance of the building somehow. When you own a detached house, you usually pay for that out of pocket. With shared ownership models, you typically pay into a shared pool that can be drawn from to pay for maintenance needs.
      - navaati 3y ago
kodah 3y ago
Houston isn't weighed down by the income of tech workers and lawyers, Austin is. You can build all the housing you want but if people working at the grocery store are competing with tech workers, and at some point you're having to commute labor in, the costs of everything will continue to rise.
- davidw 3y ago
  They're competing with tech workers because there isn't enough housing. If you "build all the housing you want" then there's enough for both groups of people and you don't get a competition where the grocery workers lose out.
  - kodah 3y ago
    Except that's not true, is it? https://fred.stlouisfed.org/series/ACTLISCOU12420 https://fred.stlouisfed.org/series/ACTLISCOU12420 With the exception of 2021 and part of 2022 Austin has had plenty of inventory. Texas A&M actually has really good research data on this: https://www.recenter.tamu.edu/data/housing-activity/#!/activity/MSA/Austin-Round_Rock https://www.recenter.tamu.edu/data/housing-activity/#!/activ... For context, I'm from Dallas. The same thing happened there. What were affordable apartments and starter homes went up in price as businesses consolidated there with high paid workers. The metroplex has worked to expand to all available land and yet they still struggle to make houses and apartments affordable.
    - davidw 3y ago
      Those data don't show that there's "enough", just that there are some listings in Austin. Extraordinary claims like "supply and demand don't actually apply to housing" require extraordinary proof.
      - kodah 3y ago
        Extraordinary claims like putting something in air quotes that I didn't say are just flat out ignorant. If you look at the table the cost of homes quadrupled over a period where inventory rose substantially. There are incentive systems at play with residences and those incentive systems go far beyond just inventory counts and density is my point.
endisneigh 3y ago
I find this article to be embarrassingly bad. Just find metro areas and compare neighborhoods and observe density levels, and see the effect on price. The author clearly has an agenda and basically wrote the article around it. Why all the conjecture? I was bored so I did a very crude estimate. Houston has 982,694 homes according to the census data in 665 square miles. Austin has 426,899 homes in 271 square miles. So Austin is denser and more expensive. To me this makes sense. Denser areas are more popular, and popularity results in high income people coming in and biding up prices. This is why there are no dense areas that are cheap.
- pickovven 3y ago
  The article isn't great but your analysis is probably worse. No per Capita analysis? No income analysis? Only two cities? This is actually a challenging question to answer. Thankfully other people have done research and we can reference that if we actually want to know the answer, rather than just prove our priors to ourselves.
- davidw 3y ago
  Land is going to be expensive in popular areas, but dense housing means that you can get a lot more housing on the same land, so you can still contain prices, even if they're probably not going to be super low. Let's look at the prices in Chicago, which is a pretty dense place: https://www.realtor.com/realestateandhomes-search/Chicago_IL/overview https://www.realtor.com/realestateandhomes-search/Chicago_IL... - $350K Now let's look at the fairly bland, suburban college town where I grew up, which is not dense: https://www.realtor.com/realestateandhomes-search/Eugene_OR/overview https://www.realtor.com/realestateandhomes-search/Eugene_OR/... - $495K! Eugene is far more expensive than the dense place with a lot of amenities and jobs.
  - atdrummond 3y ago
    I would argue Eugene’s market is heavily influenced by Nike and UOregon (and recently remote worker flight from downtown Portland) and as such, drawing a line directly from its lack of density to lack of affordability strains credulity for me. This relationship between density and cost reverses for nearby towns like Springfield even though they share many of Eugene’s characteristics.
davidw 3y ago
There's all kinds of research showing that supply and demand are very real for housing and that adding supply helps contain prices: * https://cayimby.org/its-only-a-housing-market-if-you-can-move-evidence-from-helsinki/ https://cayimby.org/its-only-a-housing-market-if-you-can-mov... * https://www.pewtrusts.org/en/research-and-analysis/articles/2023/04/17/more-flexible-zoning-helps-contain-rising-rents https://www.pewtrusts.org/en/research-and-analysis/articles/... * https://kevinerdmann.substack.com/p/we-need-affordable-housing-not-market https://kevinerdmann.substack.com/p/we-need-affordable-housi... Just off the top of my head. Edit: Wow, some of the comments here are like exhibit A for Jerusalem Demsas' piece on how housing breaks people's brains: https://www.theatlantic.com/ideas/archive/2022/11/us-housing-supply-shortage-crisis-2022/672240/ https://www.theatlantic.com/ideas/archive/2022/11/us-housing... - "Supply skepticism and shortage denialism are pushing against the actual solution to the housing crisis: building enough homes."
- whitemary 3y ago
  [flagged]
  - davidw 3y ago
    Trickle down is a completely different thing: the idea was to give wealthy people extra cash and hope some of it came to the rest of us. Supply and demand is pretty basic, apolitical economics, but it is true that if there's a shortage, it's going to hit hardest those with less money. Which means we should aim for an abundance of necessary goods like housing and food. We should do that by building both more market rate and subsidized housing in the places people want to live.
    - whitemary 3y ago
      > give wealthy people extra cash and hope some of it came to the rest of us Is letting them run hog wild through our cities replacing neighborhoods with luxury high rises for foreign investors any different? Obviously we could always use more updated housing in urban areas, but you are either stupid or acting like it when you pretend the argument is not about who should be building that housing and whether anyone should profit from owning it.
paulpauper 3y ago
Scott Alexander's argument is correct. 'Building more' likely means building outwards. This means the existing expensive , dense metro areas remain expensive due to scarcity, demand ,and good paying jobs. The newer construction is cheaper but not as desirable. If single family homes were replaced with dense, ugly condos then maybe he would be wrong.
- davidw 3y ago
  There are a lot of ways to build 'enough'. That includes all of out, up and in: https://www.sightline.org/2023/02/07/yes-oregon-there-is-a-way-to-build-enough-homes/ https://www.sightline.org/2023/02/07/yes-oregon-there-is-a-w...
- bombcar 3y ago
  Building outwards can be dense, also; if you have an existing mass transit rail line that goes into a city, you can build a new "suburb" around a station that itself is quite dense and still have easy access to the city. But the vast majority of people in the United States, if given the choice, will pick a single-family home over a condo/apartment.
cozzyd 3y ago
Building a large supply of high-rise apartments can certainly decrease prices... see e.g. downtown Chicago which has cycles of over-building apartments resulting in lower rents, then waiting for rents to rise before building more.
jackcosgrove 3y ago
Manhattan used to be more densely populated and prices were lower. I found this neat article https://millersamuel.com/change-is-constant-100-years-of-new-york-real-estate/ https://millersamuel.com/change-is-constant-100-years-of-new... In the 1910s when Manhattan's population was 2.3 million, price per square foot (PPSF) was $8. In the 2010s when the population was 1.6 million PPSF was $1070. Inflation from the 1910s to the 2010s was about 22x. PPSF in Manhattan rose by 134x over the same time, even as the population fell.
- endisneigh 3y ago
  Without knowing the price of other metro areas the data doesn’t seem useful.
  - jackcosgrove 3y ago
    I agree that real estate is complex and simply plotting density vs price along any dimension isn't very useful. My analysis is as complex as Scott Alexander's and arrives at the opposite conclusion.
- vikingerik 3y ago
  Is this accounting for quality increases? The median square foot in Manhattan today is of much higher quality than that of 1910.
- kortilla 3y ago
  Living in the city sucked in 1910. Terrible pollution, sanitation issues, etc. It was where you went when you were desperate for work.
Out_of_Characte 3y ago
This article does not make sense to me. City's main point of attractiveness is high density. When you have a place with lots of resources ( usually near rivers ) people will move there. The more people, the more business which means if there's any place for any nice market then hitting the biggest cities first is a good bet. Yes, this means the more houses you build in an area, the more people will move there which will increase the attractiveness of a city. Attractiveness can be represented as value. This, in no way means you should stop building houses in places that are the most attractive. Quite the opposite. Build until the price drops or the cost of even higher density outstrips the benefit that could be gained. Eventually too many people will be priced out. You might not like the idea that only the very rich can occupy the highest value spot in a city but thats just free market. "They added two more lanes to the freeway, but the traffic is worse than ever.” But that’s a wonderful result" No, its not. Thoughput is a function of speed * vehicles. Having a 6 lane highway at a crawl is as effective as a single lane highway at decent speed. Induced demand is complicated to grasp but the core is that highways are terrible at moving lots of people and any additional highway will make more people drive to match the highway's new capacity. A neverending traffic loop. Trains, trams, buses and cyclepaths all move more people which should be prioritised. Many countries atleast have priority for buses which makes them a better option. Most american cities treat them like another car but with lower status.
- DrJokepu 3y ago
  Does public transport not create induced demand? Won’t a new tram line encourage people to make journeys that weren’t feasible before?
  - Moldoteck 3y ago
    Exactly. That's why tram+bike combo in Netherlands is so effective. People travel big distance by train and small distance to work, home and shops. Since trams are very efficient at moving a lot of people car congestion will be reduced. If number of people using trams increases more than their capacity, surprise, you can add another section without hiring one more driver. So big capacity transport that can be adapted to demand and that has priority on the road(it's own lane) and is frequent enough basically can satisfy most of the traffic human needs
7e 3y ago
If there is less housing, people will have fewer children. If there is more housing, people will have more. Building more houses, in the long term, just results in breeding a larger population of people. And for what? To cover the entire world in concrete and shoot emissions through the roof? At some point, we need to stop building. We need to live sustainably. The world cannot support an infinite number of people with a high quality of life.
- Moldoteck 3y ago
  You have false premises. Building a lot doesn't result in breeding and higher density can be better for environment. Look at Russia's and China's multifloor buildings but population in that regions decreases because it looks like s*t(hello urban planning) and look at Netherlands where ~5-10 floor buildings are a norm and they get a lot of people and still due to efficient transportation and planning, their emissions are much less compared to low density cities in US where everybody should move by car even for grocceries(and thats despite bad weather with a lot of wind and rain that imo is worse for bikes than some hills that are not a problem because of e-assist)
choeger 3y ago
I think there are many examples for induced demand for apartments: People definitely move to get a few minutes closer to work, get a bigger apartment, or just to be closer to friends and family. That means, they will indeed come if you build it. In my view, housing problems are a function of ever denser cities. It's clear that we can stuff an immense amount of humans into a single square kilometer, but there has to be a downside. That downside is the fact that demand will usually be much higher than supply. If that wasn't the case, we couldn't convince so many people to live so close to each other in the first place.
- Panzer04 3y ago
  But it has the benefit of lifting pressure on house prices in many other locations. Many cities sprawl in extremely inefficient ways as they attempt to accomodate excessive demand, while apartments etc are much cheaper on a societal level in the long term.
shrubble 3y ago
Until someone understands the distorting effect of "bonus depreciation" which was added to the tax regs in 2017, and adjusts for that in their article, I view it with skepticism.
- lotsofpulp 3y ago
  Since buildings were and are not eligible for bonus depreciation, nor is land, how do those tax changes in 2017 TCJA affect urban density and home prices?
  - shrubble 3y ago
    So you go over the property and you say that interior property items like stove, fridge, molding, other improvements (not repairs) are separate items from the real estate. For instance, "kitchen $20,000" -this can now be written off immediately. To my mind it explains partially the luxury condo drive... the bonus depreciation is in those luxury parts which can be broken out and depreciated 100% in the first year of ownership.
jonstewart 3y ago
Shocked shocked to find out that an average psychotherapist-cum-libertarian-blogger would be wrong about the economics of urban housing.
helen___keller 3y ago
Arguing about housing economics with entrenched opinions is essentially pointless. It’s like arguing about evolution against intelligent design. Nobody can make a controlled test to demonstrate millions of years of macro evolution, or to demonstrate the effects of housing policy on home prices. Smaller controlled tests or past observations are all explained away by countless confounders. All that we’re left with is partisan bickering. It’s up to you to decide whether your opinion on housing economics is like evolution or like intelligent design.

76 points by luu 3y ago

deleted 3y ago

[deleted]

Well written and fairly convincing. Slightly off topic but the side point about highway capacity expansion projects interests me. I’m guessing it won’t be popular. But it’s true that more people are traveling and choosing to travel despite the congestion. I’ve never heard the urbanists so quick to dismiss such projects address these points.

bobthepanda 3y ago
The issue from an urbanism perspective is not really that highways fill up immediately. The problem is generally selling capacity expansion as "reducing congestion" when it does nothing of the sort. That, and the capacity gets used so quickly that you are very quickly spending yourself into a hole trying to build ever more highway capacity. The thing about a train is that it's very hard to make it so crowded the service degrades due to congestion, at least not within the first 20-50 years. This black hole of money needed for highway congestion then starts pulling away from other municipal and transportation funding needs.
- kj4211cash 3y ago
  But that's true of public transit projects too. They always promise to reduce congestion and never actually do. Congestion charging is probably the only way to really reduce congestion and in many ways the solution is worse than the problem. And, more than not being a problem, the highway filling up immediately is actually a benefit. Because more people are able and are choosing to travel, to accomplish whatever they need and want to accomplish. Granted, the externality costs of all that car travel are high. But that's almost a separate issue and one that we really should be solving by a better accounting of costs and additional taxes. It's a shame that won't happen.
  - bobthepanda 3y ago
    It doesn’t reduce road congestion but it does reduce transit congestion. The Second Avenue Subway, for example, decreased loads on the parallel congested Lexington Avenue line by 11%: https://www.6sqft.com/in-just-a-month-second-avenue-subway-eases-congestion-on-the-lexington-avenue-line-by-11-percent/ https://www.6sqft.com/in-just-a-month-second-avenue-subway-e.... It’s displaced 88,000 trips a day, and yet it’s not anywhere near full; a highway expansion would struggle with that amount. Traffic speeds generally have a floor of how long the equivalent public transport journey is. (If the public transport journey is faster, people will use that instead.) The issue now is that American land use is so out of whack it’s hard to deploy transit widely enough to make that true for the majority of trips.
    - kj4211cash 3y ago
      I think you're on to something with regards to subways in urban environments moving a number of people that a highway expansion would struggle to match. Feels to me like movement of people should be the real metric and, given that, that we should be prioritizing transit investments in places like NYC, San Francisco, and West LA (as opposed to light rail to Azusa). Downs-Thomson Paradox is also interesting here and relates to your second paragraph. In a built out environment, transit trips and car trips will take roughly the same amount of time, door to door. Transit advocates have used that finding as a way to complain about road projects, but I think it actually is a much more interesting finding that suggests a more multi-modal approach to planning. I wonder how relevant or irrelevant it is for non-built-out environments.
      - bobthepanda 3y ago
        In the US at least, really the complaint from transit advocates is that funding is and continues to be overwhelmingly road-centric, with a small share for transit and basically a pittance for walking and biking. Usually the issue with suburban transit investment occurring over urban ones is that urban areas are so weak they cannot fund expansions by themselves, and if you want the suburbs to pony up they’ll get their pound of flesh
- cwalv 3y ago
  It'd be interesting to think about ways we could implement congestion control on highways .. every thread I've read implicitly assumes it's not possible
  - bobthepanda 3y ago
    You have to limit demand, which is unpopular, because no one wants to be the one on the losing end of a ramp meter or a toll.
throw3823423 3y ago
The problem of the highway expansion is not damage done by the highway, or that the highway itself doesn't increase value for land far away: It's that the very subsidized highway later gives us horribly inefficient land uses which don't pay for themselves. So yes, the widening of the highway makes the suburb more valuable, but the second effects make the city spend more resources on parking and makes the streets worse for anyone nearby. It's no picnic for the suburb either: A car-centric infrastructure basically bans anything else. That would be fine and all, if ultimately it produced more value than the alternatives. But look at the parking lots that were designed to never get completely full on black friday, back when it was actually a time where people did local shopping. Nowadays it's all wasted infrastructure, expensive to redevelop. If you thought that the commercial real estate office in dense cities was in trouble, don't look at the one in suburbs. So it isn't really the highway, but all the things that relying on the highway leads to.
- throwaway173738 3y ago
  Not to mention how loud highways are. A concrete freeway generates enough noise at rush hour to make conversation impossible a quarter mile away. Nobody who lives nearby spends any time outside.
Karrot_Kream 3y ago
Urbanists don't like highways because highways are generally sold to the public as a way to reduce congestion; what usually happens is the extra lanes fill up immediately. The capacity of a train is much larger and it's a lot cheaper to increase throughput on a train line (by running more trains, longer trains, etc) than it is on a highway.
pickovven 3y ago
Urbanists disagree that more VMT is inherently good. VMT is good because of why people make trips - see their family, go to work, shop etc. The alternative isn't eliminating those trips. It's taking the trillions of dollars we waste and spending it on an alternative, more efficient modes that deliver better outcomes (travel time, cost, speed, comfort, etc)
- kj4211cash 3y ago
  I agree that VMT is good because of why people make those trips. If you're saying spending all that money on public transit would be a better way to help more people make more of those trips, then you'd be unequivocally wrong in much of the US. Go to someplace like Dallas and marvel at the nearly empty buses and light rail run cars. Maybe we could focus on dramatically improving public transit in someplace suitably dense like West LA. If only the politics allowed it.
jltsiren 3y ago
Most people don't object to increasing rural highway capacity. However, the increased traffic has to go somewhere, and nobody likes busy streets in their neighborhood. Not in the suburbs, and not in the city. People generally want less traffic in their area, not more. Urbanists tend to prefer walkable cities. They want to use less above-ground space for traffic and parking, leaving more space for buildings, parks, and public squares. Highway capacity expansions work against that, because they encourage more people to drive into the city.
JambalayaJim 3y ago
Urbanists don't view the fact that more people are choosing to travel as good, because of the destructive effects of that travel (noise, pollution, parking, etc.)
rr808 3y ago
I've lived in European cities and American cities. American cities are more car centric and its actually more convenient. Many cities in Europe are so congested and difficult to drive but its by design rather than a bug - it means people are more likely to get trains to get out of town. I do see that more roads encourages more cars and driving, I've found it to be a good thing.
- bobthepanda 3y ago
  Car dependency generally results in negative health outcomes though. * driving is just less healthy than walking, biking, or walking to and from public transport * driving causes high noise pollution and emissions; EVs will solve the latter but not the former, since above low speeds most of the noise is tires rolling against roads * increased driving in the US has led to higher fatality rates for the people still walking and biking * increased driving leads to lower funding levels for other types of transport since road infrastructure is so expensive, and not everybody can afford a car to avoid getting left behind
  - rr808 3y ago
    Great! Well I moved from Europe to the US, and I'm not going back.

rcpt 3y ago

The graph is misleading. Sure Manhattan is expensive but you can easily find a 2 bedroom in Jackson Heights for under $300k and still take the F train to work in the city. In the Bay Area that price point will have you on the freeway 4+ hours every day.

Aunche 3y ago
>you can easily find a 2 bedroom in Jackson Heights for under $300k I agree with your overall point, but home prices are somewhat misleading in NYC. The "affordable" places tend to have lots of fees. That $300k 2b in Jackson Heights that's within walking distance to a subway line is probably going to have a $900 HOA.
- sologoub 3y ago
  HOAs in CA are frequently above $500, so the $900 HOA won’t skew the payment that much, plus you also have to account for amenities included in the HOA. CA HOA amenities tend to be fairly light and building/lot maintenance focused.
- navaati 3y ago
  Beg your pardon ? After you have sunk all that capital, you still have to pay an amount that's basically equal to a (small) rent ?
  - rcpt 3y ago
    Yes.
  - TheCoelacanth 3y ago
    Have to pay for maintenance of the building somehow. When you own a detached house, you usually pay for that out of pocket. With shared ownership models, you typically pay into a shared pool that can be drawn from to pay for maintenance needs.
    - navaati 3y ago

kodah 3y ago

Houston isn't weighed down by the income of tech workers and lawyers, Austin is. You can build all the housing you want but if people working at the grocery store are competing with tech workers, and at some point you're having to commute labor in, the costs of everything will continue to rise.

davidw 3y ago
They're competing with tech workers because there isn't enough housing. If you "build all the housing you want" then there's enough for both groups of people and you don't get a competition where the grocery workers lose out.
- kodah 3y ago
  Except that's not true, is it? https://fred.stlouisfed.org/series/ACTLISCOU12420 https://fred.stlouisfed.org/series/ACTLISCOU12420 With the exception of 2021 and part of 2022 Austin has had plenty of inventory. Texas A&M actually has really good research data on this: https://www.recenter.tamu.edu/data/housing-activity/#!/activity/MSA/Austin-Round_Rock https://www.recenter.tamu.edu/data/housing-activity/#!/activ... For context, I'm from Dallas. The same thing happened there. What were affordable apartments and starter homes went up in price as businesses consolidated there with high paid workers. The metroplex has worked to expand to all available land and yet they still struggle to make houses and apartments affordable.
  - davidw 3y ago
    Those data don't show that there's "enough", just that there are some listings in Austin. Extraordinary claims like "supply and demand don't actually apply to housing" require extraordinary proof.
    - kodah 3y ago
      Extraordinary claims like putting something in air quotes that I didn't say are just flat out ignorant. If you look at the table the cost of homes quadrupled over a period where inventory rose substantially. There are incentive systems at play with residences and those incentive systems go far beyond just inventory counts and density is my point.

endisneigh 3y ago

I find this article to be embarrassingly bad. Just find metro areas and compare neighborhoods and observe density levels, and see the effect on price. The author clearly has an agenda and basically wrote the article around it. Why all the conjecture? I was bored so I did a very crude estimate. Houston has 982,694 homes according to the census data in 665 square miles. Austin has 426,899 homes in 271 square miles. So Austin is denser and more expensive. To me this makes sense. Denser areas are more popular, and popularity results in high income people coming in and biding up prices. This is why there are no dense areas that are cheap.

pickovven 3y ago
The article isn't great but your analysis is probably worse. No per Capita analysis? No income analysis? Only two cities? This is actually a challenging question to answer. Thankfully other people have done research and we can reference that if we actually want to know the answer, rather than just prove our priors to ourselves.
davidw 3y ago
Land is going to be expensive in popular areas, but dense housing means that you can get a lot more housing on the same land, so you can still contain prices, even if they're probably not going to be super low. Let's look at the prices in Chicago, which is a pretty dense place: https://www.realtor.com/realestateandhomes-search/Chicago_IL/overview https://www.realtor.com/realestateandhomes-search/Chicago_IL... - $350K Now let's look at the fairly bland, suburban college town where I grew up, which is not dense: https://www.realtor.com/realestateandhomes-search/Eugene_OR/overview https://www.realtor.com/realestateandhomes-search/Eugene_OR/... - $495K! Eugene is far more expensive than the dense place with a lot of amenities and jobs.
- atdrummond 3y ago
  I would argue Eugene’s market is heavily influenced by Nike and UOregon (and recently remote worker flight from downtown Portland) and as such, drawing a line directly from its lack of density to lack of affordability strains credulity for me. This relationship between density and cost reverses for nearby towns like Springfield even though they share many of Eugene’s characteristics.

davidw 3y ago

There's all kinds of research showing that supply and demand are very real for housing and that adding supply helps contain prices: * https://cayimby.org/its-only-a-housing-market-if-you-can-move-evidence-from-helsinki/ https://cayimby.org/its-only-a-housing-market-if-you-can-mov... * https://www.pewtrusts.org/en/research-and-analysis/articles/2023/04/17/more-flexible-zoning-helps-contain-rising-rents https://www.pewtrusts.org/en/research-and-analysis/articles/... * https://kevinerdmann.substack.com/p/we-need-affordable-housing-not-market https://kevinerdmann.substack.com/p/we-need-affordable-housi... Just off the top of my head. Edit: Wow, some of the comments here are like exhibit A for Jerusalem Demsas' piece on how housing breaks people's brains: https://www.theatlantic.com/ideas/archive/2022/11/us-housing-supply-shortage-crisis-2022/672240/ https://www.theatlantic.com/ideas/archive/2022/11/us-housing... - "Supply skepticism and shortage denialism are pushing against the actual solution to the housing crisis: building enough homes."

whitemary 3y ago
[flagged]
- davidw 3y ago
  Trickle down is a completely different thing: the idea was to give wealthy people extra cash and hope some of it came to the rest of us. Supply and demand is pretty basic, apolitical economics, but it is true that if there's a shortage, it's going to hit hardest those with less money. Which means we should aim for an abundance of necessary goods like housing and food. We should do that by building both more market rate and subsidized housing in the places people want to live.
  - whitemary 3y ago
    > give wealthy people extra cash and hope some of it came to the rest of us Is letting them run hog wild through our cities replacing neighborhoods with luxury high rises for foreign investors any different? Obviously we could always use more updated housing in urban areas, but you are either stupid or acting like it when you pretend the argument is not about who should be building that housing and whether anyone should profit from owning it.

paulpauper 3y ago

Scott Alexander's argument is correct. 'Building more' likely means building outwards. This means the existing expensive , dense metro areas remain expensive due to scarcity, demand ,and good paying jobs. The newer construction is cheaper but not as desirable. If single family homes were replaced with dense, ugly condos then maybe he would be wrong.

davidw 3y ago
There are a lot of ways to build 'enough'. That includes all of out, up and in: https://www.sightline.org/2023/02/07/yes-oregon-there-is-a-way-to-build-enough-homes/ https://www.sightline.org/2023/02/07/yes-oregon-there-is-a-w...
bombcar 3y ago
Building outwards can be dense, also; if you have an existing mass transit rail line that goes into a city, you can build a new "suburb" around a station that itself is quite dense and still have easy access to the city. But the vast majority of people in the United States, if given the choice, will pick a single-family home over a condo/apartment.

cozzyd 3y ago

Building a large supply of high-rise apartments can certainly decrease prices... see e.g. downtown Chicago which has cycles of over-building apartments resulting in lower rents, then waiting for rents to rise before building more.

jackcosgrove 3y ago

Manhattan used to be more densely populated and prices were lower. I found this neat article https://millersamuel.com/change-is-constant-100-years-of-new-york-real-estate/ https://millersamuel.com/change-is-constant-100-years-of-new... In the 1910s when Manhattan's population was 2.3 million, price per square foot (PPSF) was $8. In the 2010s when the population was 1.6 million PPSF was $1070. Inflation from the 1910s to the 2010s was about 22x. PPSF in Manhattan rose by 134x over the same time, even as the population fell.

endisneigh 3y ago
Without knowing the price of other metro areas the data doesn’t seem useful.
- jackcosgrove 3y ago
  I agree that real estate is complex and simply plotting density vs price along any dimension isn't very useful. My analysis is as complex as Scott Alexander's and arrives at the opposite conclusion.
vikingerik 3y ago
Is this accounting for quality increases? The median square foot in Manhattan today is of much higher quality than that of 1910.
kortilla 3y ago
Living in the city sucked in 1910. Terrible pollution, sanitation issues, etc. It was where you went when you were desperate for work.

Out_of_Characte 3y ago

This article does not make sense to me. City's main point of attractiveness is high density. When you have a place with lots of resources ( usually near rivers ) people will move there. The more people, the more business which means if there's any place for any nice market then hitting the biggest cities first is a good bet. Yes, this means the more houses you build in an area, the more people will move there which will increase the attractiveness of a city. Attractiveness can be represented as value. This, in no way means you should stop building houses in places that are the most attractive. Quite the opposite. Build until the price drops or the cost of even higher density outstrips the benefit that could be gained. Eventually too many people will be priced out. You might not like the idea that only the very rich can occupy the highest value spot in a city but thats just free market. "They added two more lanes to the freeway, but the traffic is worse than ever.” But that’s a wonderful result" No, its not. Thoughput is a function of speed * vehicles. Having a 6 lane highway at a crawl is as effective as a single lane highway at decent speed. Induced demand is complicated to grasp but the core is that highways are terrible at moving lots of people and any additional highway will make more people drive to match the highway's new capacity. A neverending traffic loop. Trains, trams, buses and cyclepaths all move more people which should be prioritised. Many countries atleast have priority for buses which makes them a better option. Most american cities treat them like another car but with lower status.

DrJokepu 3y ago
Does public transport not create induced demand? Won’t a new tram line encourage people to make journeys that weren’t feasible before?
- Moldoteck 3y ago
  Exactly. That's why tram+bike combo in Netherlands is so effective. People travel big distance by train and small distance to work, home and shops. Since trams are very efficient at moving a lot of people car congestion will be reduced. If number of people using trams increases more than their capacity, surprise, you can add another section without hiring one more driver. So big capacity transport that can be adapted to demand and that has priority on the road(it's own lane) and is frequent enough basically can satisfy most of the traffic human needs

7e 3y ago

If there is less housing, people will have fewer children. If there is more housing, people will have more. Building more houses, in the long term, just results in breeding a larger population of people. And for what? To cover the entire world in concrete and shoot emissions through the roof? At some point, we need to stop building. We need to live sustainably. The world cannot support an infinite number of people with a high quality of life.

Moldoteck 3y ago
You have false premises. Building a lot doesn't result in breeding and higher density can be better for environment. Look at Russia's and China's multifloor buildings but population in that regions decreases because it looks like s*t(hello urban planning) and look at Netherlands where ~5-10 floor buildings are a norm and they get a lot of people and still due to efficient transportation and planning, their emissions are much less compared to low density cities in US where everybody should move by car even for grocceries(and thats despite bad weather with a lot of wind and rain that imo is worse for bikes than some hills that are not a problem because of e-assist)

choeger 3y ago

I think there are many examples for induced demand for apartments: People definitely move to get a few minutes closer to work, get a bigger apartment, or just to be closer to friends and family. That means, they will indeed come if you build it. In my view, housing problems are a function of ever denser cities. It's clear that we can stuff an immense amount of humans into a single square kilometer, but there has to be a downside. That downside is the fact that demand will usually be much higher than supply. If that wasn't the case, we couldn't convince so many people to live so close to each other in the first place.

Panzer04 3y ago
But it has the benefit of lifting pressure on house prices in many other locations. Many cities sprawl in extremely inefficient ways as they attempt to accomodate excessive demand, while apartments etc are much cheaper on a societal level in the long term.

shrubble 3y ago

Until someone understands the distorting effect of "bonus depreciation" which was added to the tax regs in 2017, and adjusts for that in their article, I view it with skepticism.

lotsofpulp 3y ago
Since buildings were and are not eligible for bonus depreciation, nor is land, how do those tax changes in 2017 TCJA affect urban density and home prices?
- shrubble 3y ago
  So you go over the property and you say that interior property items like stove, fridge, molding, other improvements (not repairs) are separate items from the real estate. For instance, "kitchen $20,000" -this can now be written off immediately. To my mind it explains partially the luxury condo drive... the bonus depreciation is in those luxury parts which can be broken out and depreciated 100% in the first year of ownership.

jonstewart 3y ago

Shocked shocked to find out that an average psychotherapist-cum-libertarian-blogger would be wrong about the economics of urban housing.

helen___keller 3y ago

Arguing about housing economics with entrenched opinions is essentially pointless. It’s like arguing about evolution against intelligent design. Nobody can make a controlled test to demonstrate millions of years of macro evolution, or to demonstrate the effects of housing policy on home prices. Smaller controlled tests or past observations are all explained away by countless confounders. All that we’re left with is partisan bickering. It’s up to you to decide whether your opinion on housing economics is like evolution or like intelligent design.