Monday, April 28, 2008

Joe Cortright says that higher gas prices are hurting suburbs and places without strong urban cores

He writes:
...high gas prices are not only implicated in the bursting of the housing bubble, but that the higher cost of commuting has already re-shaped the landscape of real estate value between cities and suburbs. Housing values are falling fastest in distant suburban and exurban neighborhoods where affordability depended directly on cheap gas. In metro areas around the country, housing prices are down most on the fringe, while close-in neighborhoods are holding more of their value--or in several cases, still continuing to see price appreciation.
And the analysis also shows that those metropolitan areas with the strongest close-in neighborhoods--as measured by the core vitality index we developed in our 2006 City Vitals report--have weathered the housing collapse far better than other metros. House prices have performed best and foreclosures have been lower in those metropolitan areas with vibrant core neighborhoods.

Far from being a short term or transitory event, our view is that this shift in real estate market valuations implies a fundamentally different path for future urban development in the years ahead. As my colleague, CEO's for Cities President Carol Coletta puts it, "In short, vibrant cities just became a whole lot more valuable."

There are tremendous opportunities for the nation's cities to build on this shift in value, promoting redevelopment, mixed uses, higher densities and better transit. These strategies will also play a key role in helping reduce energy demand (and the trade deficit) as well as putting us on a path to dealing with the challenge of global warming.


The paper has lots of interesting pictures relating location to changes in house prices. But I think a key policy question is whether "strong urban cores" can be created by design, or whether they are organic phenomena.

6 comments:

AC said...

Let me posit an alternative theory:

Places with lots of subprime borrowers have seen the biggest decline in prices. In Cleveland and Detroit, that has been in central city neighborhoods. In Los Angeles and Atlanta, it has happened in the far-flung suburbs. The expensive areas have fared better because their customers have higher incomes and are thus less likely to be subprime. Since healthy, vibrant core neighborhoods tend to be expensive, they naturally have fewer subprime homeowners, and are less vulnerable to the subprime market collapse.

Cortright has not tried to disentangle the subrime collapse from the effect of rising gasoline prices.

I would like to an analysis based on rents rather than home prices. If gasoline prices are depressing demand for suburban living, suburban rents should be falling. If the subprime collapse is depressing demand for single-family homes (because would-be buyers can't get credit), then rents should be rising.

Without disentangling the effects of the credit crunch and spike in gas prices, Cortright's analysis seems like wishful thinkgin.

Anonymous said...

It looks like far flung large lots and hard to heat giant homes are not working out as advertised. Maybe citizens can convince foreign savers to buy securitized sub prime gasoline loans to go with the mega jumbo sub prime mortgages. Maybe the burbs will need easier to heat small homes on easier to drive to smaller lots to stay viable.

Anonymous said...

^^Thanks!!

婚前徵信婚姻感情大陸抓姦外遇抓姦法律諮詢家暴婚前徵信尋人感情挽回大陸抓姦離婚工商徵信婚前徵信外遇抓姦感情挽回尋人大陸抓姦離婚家暴工商徵信法律諮詢跟蹤工商徵信婚前徵信感情挽回外遇抓姦法律諮詢家暴尋人大陸抓姦離婚大陸抓姦外遇尋人家暴工商徵信法律諮詢家暴感情挽回大陸抓姦外遇婚前徵信離婚尋人工商徵信外遇抓姦法律諮詢家暴婚前徵信大陸抓姦尋人感情挽回外遇抓姦婚前徵信感情挽回尋人大陸抓姦工商徵信法律諮詢離婚家暴工商徵信外遇抓姦法律諮詢家暴婚前徵信尋人感情挽回大陸抓姦離婚婚前徵信工商徵信外遇抓姦尋人離婚家暴大陸抓姦感情挽回法律諮詢離婚感情挽回婚前徵信外遇抓姦家暴尋人工商徵信外遇抓姦法律諮詢家暴婚前徵信尋人感情挽回">徵大陸抓姦離婚婚前徵信工商徵信外遇抓姦尋人離婚家暴大陸抓姦感情挽回法律諮詢

rong said...

your article is very good, but do you like the pink ghd
babyliss
armani sunglasses
gucci sunglasses outlet
discount abercrombie and fitch clothes
abercrombie fitch outlet
abercrombie & fitch clothing
ed hardy wholesale
cheap ed hardy wholesale
discount ed hardy wholesale
wholesale ed hardy
ed hardy outlet
paul smith shirt
paul smith outlet
paul smith 2010
cheap paul smith
discount paul smith
paul smith shoes
Burberry scarf
Burberry outlet
cheap Burberry handbags
Burberry totes
newest Burberry
moncler
Moncler jackets
Moncler coats
Moncler Vest
discount Moncler outlet
moncler polo t shirt
newest air max
cheap air max shoes
air max outlet
discount air max
air max nike
cheap ugg boots
discount ugg boots
ugg boots
classic ugg boots
ugg classic tall boots

rong said...

how do you think the AirMax BW
AirMax Huarache
AirMax LTD
AirMax Skyline
AirMax TN
AirMax Zength
AirMax 09
AirMax 180
AirMax 2003
AirMax 2006
AirMax 2009
AirMax 2010
AirMax 360
AirMax 87
AirMax 90
AirMax 91
AirMax 92
AirMax 93
AirMax 95

gaohui said...

You will not have ed hardy clothes to worry about any Christian audigier discomfort, and best of all; most are ed hardy shoes designed to fit your body as the ed hardy outlet little bundle of joy grows allowing ed hardy Bikini you to wear the maternity clothing more than ed hardy hats once.The development of holiday maternity ed hardy swimsuits clothing has coincided with the changing attitudes of ed hardy clothing women regarding their bodies. Today's ed hardy glasses holiday maternity fashions are ed hardy trendy, stylish and sexy, fitting today's ed hardy iphone cases fast-paced lifestyle Now, women ed hardy dresses are proud to show off their baby bump while wearing ed hardy Jackets striking and classy maternity clothing.