There have been a couple of stories over the past couple weeks that have brought out the public policy/planning nerd in me.
John McCarron, a local expert on city planning type stuff, pointed out in a Tribune column that transportation expenses may wipe out savings on housing in far flung locations.
Of course, this is nothing new at the Chicago Real Estate Local blog. I've made the case a few times for choosing proximity and lifestyle over huge pre-fabricated homes.
McCarron is right to point out rising gas prices have but a black eye on the sprawl of developement. I'm all for larger density planse with city centers and excellent public transportation.
But McCarron takes some strange shots at developers and real estate agents:
"There are good economic reasons why it should. If young families did the math, they might discover that buying a bargain-priced split-level on the suburban fringe isn't such a bargain after all, what with automotive expenses. Better to buy closer in, near a Metra line or a bus route, within walking distance of schools and stores.
Trouble is, that kind of math rarely gets done. Who's going to bring it up? Not the developers, who've got a sure thing buying farmland by the acre and selling it by the foot. Not the real estate agents and mortgage brokers, who want their fat commissions. They don't mention how many hours a week you'll be driving once you buy that dream four-bedroom in Minooka, Oswego or Pingree Grove.The people who turn farms into front lawns have a vested interest in shielding people from the reality of what stuff really costs. They don't want the folks who already live in the Minookas and the Oswegos, or those about to move in, to total up the cost of all the roads, sewers and schools that soon will be needed.
It's all legal, of course, this good old American way of hiding the cost/benefit reality. It's a business in which the main economic benefits are realized upfront by a savvy few, while the bulk of the costs are distributed over time to the unaware many. Sure, you can technically become one of the few by buying the stock of a corporate home-builder. But that's the hard way. Better you should buy raw farmland and wait for the home-builders to come calling."
John, give me a break! His sweeping generalizations and total lack of faith in the consumer take away from the real discussion: We do have a choice.
And according to McCarron (who's work, writing and appearances on Chicago Tonight I enjoy by the way) the housing consumer is too stupid to realize they live way out on the dark side of the moon. How did they get there... knocked out and blindfolded, only to be dropped in the yard of their dream home without knowing how much gas or time it took to drive out there?
Anyway, Crain's followed up the story with a later release citing the Center for Neighborhood Technology, a nonprofit research and advocacy group for urban communities. In what they call the Affordability Index, CNT combines transportation cost and housing cost to reach a ratio of annual household income spent on these two categories. Chicago ranks number 2 in affordability with many suburburban location registering a very high percentage in transportation and housing costs.
Of course, we would have to delve deep into quality of neighborhoods, household income (they site averages of $20-70K), workplace etc, etc... to make sense of this for ourselves.
At any rate, those seeking to move anywhere to own a single family home may want to adjust their thinking. Is it really worth the drive?