New Geography

Tag: Phoenix

  • Adding Space to Suburbia

    Space has value. Even the mere perception of space has value. As land becomes more scarce, space becomes more valuable, and has a direct impact on housing costs and a developer’s profit (or loss). Both developers and the New Urbanists who preach that dense cities are good places know this, even as they pressure town councils and planning commissions to authorize reduced lot sizes. Where they have succeeded, the resulting compressed lots sacrifice quality organic space — green space — to the point of oblivion.

    Less than a half century ago, Phoenix was a sleepy retirement town with vast openness and desert character. A few years ago, my wife Adrienne and I visited the city. Today’s Phoenix, like Las Vegas, Albuquerque, etc., is a blanket of rooftop and pavement with a few strip malls spattered about. We met with developers to demonstrate a new way to design that increases lot size (value), while reducing infrastructure (costs). Without exception, developers responded: “People move to Phoenix to have a smaller lot. They do not want space.” So we visited the new, compressed developments, and asked residents about their new homes. Without exception, all the residents we interviewed loved their new places, but wished they had more space, especially between themselves and their neighbors.

    Simply put, a larger lot with more space is likely to be more valuable to residents, but builders are interested more in selling ‘product’ — homes. The more, the better.

    A buyer will pay more for a large home than a small one; for a large lot than a small one. They will pay a premium for a home with a view of space over that what they would pay for a view into a neighbor’s adjacent yard.

    Space has value, and value translates to an increased tax base.

    The social engineer will argue that it’s OK to sacrifice space because there will be a small park a five or ten minute ‘walk’ away. Reality check: A very small percentage of residents will actually walk to that park, but the homes that can view that space will be priced at a premium, costing well above the homes in a sardine-like placement far from the park. In denser suburbs or new urban communities, the haves will enjoy space; the have-nots, not so much.

    If space does not have value, as the proponents of dense neighborhoods claim, then why is it so heavily featured in home builders’ sales and marketing materials? When a home builder uses a marketing photograph, it is taken at a wide angle to make the lot appear larger than it actually is. When a builder uses a rendering on their web site or sales materials, it’s never shown with adjacent homes compressing the visual space.

    How can we feed the hunger for space? The conventional design methods that have been used since the dawn of civilization can’t work. To achieve increased space while preserving a higher density standard, the housing industry needs to take an approach that incorporates innovation and attractive value.

    That begins with the recognition that space is something that you feel, even though it is limited by non-transparent objects that form a physical barrier in our three dimensional world. When we are inside a structure, it’s the walls around us in reference to the flat floor; when we are outside, it’s the distance we perceive between homes. We might estimate a distance as longer or shorter, depending on whether the terrain was hilly or flat.

    Does five acres within a neighborhood park constitute open space? It sounds like it will, but if it’s along steep slopes or thickly wooded land with natural underbrush it won’t feel open. If it’s a park that residents must stroll to from their homes, the space has less value than if it can be viewed through their windows.

    As for conventional interior space, the perimeter of a home is often determined by the lot size, depending on local zoning. In the case of a Phoenix lot that is 50 feet wide by 100 feet deep, with a 5 foot side yard setback and a 20 foot front and rear yard setback, the home would be allowed to be 40 feet wide and 60 feet deep. Assuming a 20 foot by 20 foot garage and 6 inch exterior wall, that leaves 1,880 square feet of living space within the home.

    But— that only would result if the home were expanded to the largest possible perimeter. Included in that perimeter would be 145 feet of side yard, the entry door, and two car spaces in the garage, leaving only 55 feet for possible window locations that would overlook the front and rear yards. Within that footprint, the architect must lay out the bedrooms, closets, bathrooms, kitchen, living and family rooms, and any other living space.

    A great architect will make the resident ‘feel’ the most of the available space. A bad designer will make the home feel smaller than it actually is. Neither the good nor the bad architect (especially when the project is created by production builders) will consider the views from within the home, because, simply put, with New Urban and suburban cookie cutter subdividing, there are none. In most southern cities the rear view overlooks a wall or fence 20 feet away, and the next house structure is at a 40 foot distance. The front view (if any windows exist at all from front-placed living space) will be the garage door across the street, 90 feet away, along with driveways, the street, and parked cars. This is why modern home living spaces are rear, not front, oriented. Not much to look at. That is, unless you pay more – much more – to be in a neighborhood with larger lots.

    Conventional exterior space is also dictated by city regulations. Local zoning ordinances determine the allowed width and depth, to limit density with the promise of more space and a larger home footprint. In conventionally subdivided developments, side yard space is not a quality area, since the sides of homes typically are void of windows, and even if there were views, those windows would look directly into the neighboring wall just 10 to 20 feet in the distance.

    The image below shows two streets:


    The left one has a 90 foot wide lot; the right one has a 60’ foot wide lot. Both use the same 25 foot front yard setback. From a ‘human’ perspective, looking down the street, both have the same 100 foot wide swath of open space, yet the smaller lot achieves 33 percent more homes with the exact same infrastructure (street) expense. Because the street covers the same land area in both cases, the actual density gain on the smaller lot would be about 25 percent, while providing the very same ‘feel’ of space as the larger lot. Assuming that the intention of suburban zoning is to set both space and value, the typical ordinance does a terrible job on providing extra actual perceived space.

    Considering that space has real value, educators at colleges, and at design conferences, and all teachers of architecture and of urban and/or suburban design, should be concentrating more on how interior and exterior spaces can merge in more meaningful ways than on the trim of a front porch. Craftsman trim on a porch railing may add a wee bit of value, but living spaces coordinated with views of open space add a huge increase in value. A park may add overall neighborhood value, but living on a street that has park-like space adds tremendous value.

    Cookie-cutter Computer Aided Drafting (CAD) plans generated specifically to build to the regulatory minimums will never satisfy the hunger for space. These two videos demonstrate my solutions. Along with other innovative approaches that merge planning and architecture, they show the paths we need to follow if we are to achieve sustainable housing, and sustainable zoning.

    Rick Harrison is President of Rick Harrison Site Design Studio and Neighborhood Innovations, LLC. He is author of Prefurbia: Reinventing The Suburbs From Disdainable To Sustainable and creator of LandMentor. His websites are rhsdplanning.com and LandMentor.com.

    Flickr photo by Joan of cat in a suburban yard

  • Forget What the Pundits Tell You, Coastal Cities are Old News – it’s the Sunbelt that’s Booming

    Ever since the Great Recession ripped through the economies of the Sunbelt, America’s coastal pundit class has been giddily predicting its demise. Strangled by high-energy prices, cooked by global warming, rejected by a new generation of urban-centric millennials, this vast southern region was doomed to become, in the words of the Atlantic, where the “American dream” has gone to die. If the doomsayers are right, Americans must be the ultimate masochists. After a brief hiatus, people seem to, once again, be streaming towards the expanse of warm-weather states extending from the southeastern seaboard to Phoenix.

    Since 2010, according to an American Community Survey by demographer Wendell Cox, over one million people have moved to the Sunbelt, mostly from the Northeast and Midwest.

    Any guesses for the states that have gained the most domestic migrants since 2010? The Sunbelt dominates the top three: Texas, Florida and Arizona. And who’s losing the most people? Generally the states dearest to the current ruling class: New York, Illinois, California and New Jersey.  Some assert this reflects the loss of poorer, working class folks to these areas while the “smart” types continue to move to the big cities of Northeast and California. Yet, according to American Community Survey Data for 2007 to 2011, the biggest gainers of college graduates, according to Cox, have been Texas, Arizona and Floria; the biggest losers are in the Northeast  (New York), the Midwest (Illinois and Michigan).

    For the most part, notes demographer Cox, this is not a movement to Tombstone or Mayberry, although many small towns in the south are doing well, this is a movement to Sunbelt cities. Indeed, of the ten fastest growing big metros areas in America in 2012, nine were in the Sunbelt. These included not only the big four Texas cities—Austin, Houston, Dallas-Ft. Worth, San Antonio—but also Orlando, Raleigh, Phoenix, and Charlotte.

    Perhaps the biggest sign of a Sunbelt turnaround is the resurgence of Phoenix, a region devastated by the housing bust and widely regarded by contemporary urbanists as the “least sustainable” of American cities. The recovery of Phoenix, appropriately named the Valley of the Sun, is strong evidence that even the most impacted Sunbelt regions are on the way back. 

    A look at the numbers on domestic migration undermines the claim that most Americans prefer, like the pundit class, to live in and near the dense Northeastern urban cores. People simply continue to vote with their feet. Since 2000, more than 300,000 people have moved to Atlanta, Dallas, Houston, and Charlotte; in contrast a net over two million left New York and 1.4 million have deserted the LA area while over 600,000 net departed Chicago and almost as many left the San Francisco Bay region. These trends were slowed, but not reversed, by the Great Recession.

    The Sunbelt’s recovery seems likely to continue in the future. Immigrants, who account for a rising proportion of our population growth, are increasingly heading there. New York remains the immigrant leader, with the foreign-born population increasing by 600,000 since 2000 but second place Houston, a relative newcomer for immigrants, gained 400,000, more than Chicago and the Bay Area combined. The regions experiencing the highest rate of newcomers were largely in the south; Charlotte and Nashville saw their foreign-born populations double as immigrants increasingly beat a path to the Sunbelt cities.

    The final demographic coup for the Sunbelt lies in its attraction for families. Eight of the eleven top fastest growing populations under 14, notes Cox, are found in the Sunbelt with New Orleans leading the pack. Generally speaking, roughly twenty percent or more of the population of Sunbelt metros are under 14, far above the levels seen in the rustbelt, the Left Coast, or in the Northeast.

    This all suggests that the Sunbelt is cementing, not losing, its grip on America’s demographic future. By 2012 and 2017, according to a survey by the manufacturing company Pitney Bowes nine of the ten leading regions in terms of household growth will be in the Sunbelt.

    If the population growth rates predicted by the US Conference of Mayors continue, Dallas-Ft. Worth will push Chicago out of third place among American metropolitan areas in 2043, with Houston passing the Windy City eight years later. Now seventh place Atlanta would move up to sixth place and Phoenix to 8th. Of America’s largest cities then, five would be located in the Sunbelt, and all are expected to grow much faster than New York, Los Angeles or the San Francisco area. Overall, the South would account for over half the growth in our major metropolitan areas in 2042, compared to barely 3.6 percent for the Northeast and 8.7 percent in the Midwest.

    What drives the change? Not just the sun, but the economy, stupidos!

    From the beginning of the Sunbelt ascendency, sunshine and warm weather have been important lures and this may even be more true in the near future. But the key forces driving people to the Sunbelt are largely economic—notably job creation, lower housing prices and lower costs relative to incomes.

    Until the housing bust, states like Arizona, Nevada and Florida were typically among the leaders in creating new jobs but their performance fell off with the decline of construction. But other Sunbelt locales, notably Texas, Louisiana and Oklahoma have picked up much of the slack. This resurgence has been centered in Texas, which created nearly a million new jobs between 2007 and 2013. In contrast, arch-rival California has lost a half a million.

    Many other Sunbelt states have yet to recover jobs lost from the recession, but most of their big metros have shown strong signs of recovery. Since 2007 five of the seven fastest growing jobs markets among the twenty largest cities were in Sunbelt states. Looking forward, recent estimates of job growth between 2013 and 2017, according to Forbes and Moody’s project employment to grow fastest in Arizona, followed by Texas. Also among the top ten are several states hit hard by the Recession, notably Florida, Georgia and Nevada. No Northeastern state appeared anywhere on the list; nor did California.

    For all its shortcomings, including what some may consider the overuse of tax breaks and incentives, the much-dissed Sunbelt development model continues to reap some significant gains. The area’s history of lagging economically has long spurred Sunbelt economic developers to utilize a policy of light regulation, low taxes and lack of unions to lure businesses to their area. Sunbelt states—Texas, Florida, the Carolinas, Tennessee, Arizona—dominate the ranks of the most business friendly states in the union, notes Chief Executive magazine, findings they often cite when courting footloose businesses.

    The clear economic capital of the Sunbelt is now Houston, with some stiff competition from Dallas-Ft. Worth. Houston, the energy capital, now ranks second only to New York in new office construction and is the overall number one for corporate expansions. There are fifty new office buildings going up in the city, including Exxon Mobil’s campus, the country’s second largest office complex under construction (after New York’s Freedom Tower). Chevron, once Standard Oil of California, has announced plans to construct a second tower for its downtown Houston campus while Occidental Petroleum, founded more than fifty years ago in Los Angeles, is moving its headquarters to Houston.

    Houston’s ascendance epitomizes the shift in the geographic and economic center of the Sunbelt. The “original in the Xerox machine” for Sunbelt style growth, Los Angeles’ rise was powered by new industries like entertainment and aerospace and oil, ever expanding sprawl and a strong, tightly knit business elite. Pleasant weather and Hollywood glitz still inform the image of Los Angeles, but under a regime dominated by government employee unions, greens and developers of dense housing, it suffers unemployment almost four points higher than Houston . Nine million square feet of space is currently being built in Houston, compared to just over one million in Los Angeles-Orange which has more than twice the population. It is not in the rising Sunbelt but in places like Southern California, where jobs lag amidst high costs, that the American dream now seems most likely to die.

    Movin’ on Up

    In Houston particularly but throughout the Sunbelt, job growth critically is not tied to cheap labor, but to  industries like energy which pay roughly $20,000 more than those in the information sector. According to EMSI, a company that models labor market data, energy has  generated some 200,000 new jobs in Texas alone over the past decade. Although Houston is the primary beneficiary, the American energy boom is also sparking strong growth in other cities, notably Dallas-Ft. Worth, San Antonio, and Oklahoma City.

    Once dependent on low-wage industries such as textiles and furniture, the energy boom is pacing a  Sunbelt move towards generally better paying heavy manufacturing. Texas and Louisiana already lead the nation in large new projects, many of them in petrochemicals and other oil-related production. Of the biggest non-energy investments, three of the top four, according to the Ernst and Young Investment Monitor, are in Tennessee, Alabama and South Carolina, which are becoming the new heartland of American heavy manufacturing, notably in automobiles and steel. Since 2010, Birmingham, Houston, Nashville and Oklahoma city all have enjoyed double digit growth in high paying industrial jobs that used to be the near exclusive province of the Great Lakes, California and the Northeast.

    The Sunbelt resurgence is important in part because it offers some hope to millions of Americans who may not have gone to Harvard or Stanford, but have work skills and ambition. The region’s growth in what might be called “middle skilled jobs” that pay $60,000 or above has been impressive.

    It may come as a surprise to some, but the Sunbelt is also pulling ahead in high tech jobs. In a recent analysis of STEM (science, technology, engineering and mathematics) job growth for Forbes we found that out of out of the 52 largest regions, the four most rapid growers over the past decade were Austin, Raleigh, Houston and Nashville, with Jacksonville, Phoenix and Dallas also in the top fifteen. In contrast New York ranked #36th out of 52 and Los Angeles, a long-time tech superpower, now a mediocre #38.

    In another example of how much things are changing, when college students in the South now graduate, noted a recent University of Alabama study, they do go to the “big city” but their top four choices outside the state are in the Sunbelt—Atlanta, Houston,  Nashville, Tenn., and Dallas—and followed then by New York. The biggest net gains in people with BAs and higher are primarily in the sunbelt, led by Phoenix,   Houston, Dallas-Ft. Worth, Austin, Houston and San Antonio; the biggest losers, according to Cox’s calculations, have been New York, Los Angeles, Chicago and, surprisingly given its reputation, Boston.

    These trends may become more pronounced as the current millennial generation starts settling down into family life. Housing costs could prove a decisive factor. In terms of the median multiple, median housing cost as share of median household income, Sunbelt cities tend to be about half as expensive as New York, Boston or Los Angeles, and one third of the Bay Area.  

    To be sure, many of the “best and brightest” will continue to flock to New York, the Bay Area or Los Angeles, but many more—particularly those without Ivy degrees or wealthy parents—may migrate to those places where their paycheck stretches the furthest. The Sunbelt, with its job growth, strong middle class wages and lows housing costs, is a good bet for the future.  

    What will the future bring?

    Prosperity, Herodotus reminded us, “never abides long in one place.” Certainly the Sunbelt economy could lose its current momentum but fortunately, having been schooled by the housing bust, many Sunbelt communities are increasingly focused on improving their basic economy—jobs, income growth, and skills-based education. Tennessee and Louisiana, for example, have led the way on expanding working training, and some of most ambitious education reform is taking place in New Orleans and Houston.

    Yet, there are many threats to continued growth, both internal and external. Given his penchant for executive orders and his close ties to wealthy green donors, President Obama could take steps—for example clamping down on fossil fuel development—that could reverse the steady growth along the Gulf Coast. Any draconian shift on climate change policies would be most detrimental to the energy sector Sunbelt states.

    But President Obama will not be in office forever. In the long run, the biggest threat to the Sunbelt ascendency is internal. Some fear that as more easterners and Californians flock to the area, they will bring with them a taste for the very regulatory and tax policies that have stifled growth in the states they left behind . Most worryingly, so called “smart growth” regulations could drive housing costs up, as occurred in Florida and several other states in the last decade, and erode some of the Sunbelt’s competitive advantage.

    Perhaps the most immediate threat comes from the angry, reactionary elements on the right, who tend to be more powerful in the sunbelt than elsewhere. These groups, sometimes including the Tea Party, have taken   positions on issues like immigration and gay rights that local business leaders fear could deprive their regions of energetic and often entrepreneurial newcomers. Equally important, the right’s anti-tax orthodoxy, although perhaps not as devastating as the huge burdens placed on middle class individuals in the North and California, could delay critical outlays in transportation, parks and other essential infrastructure in regions that are growing rapidly. This is particularly true of education, a field in which most Sunbelt cities, while gaining ground, remain below the national average.

    Whatever one thinks of the motivations of the green clerisy, there are clearly environmental measures, particularly in the Sunbelt’s western regions, that these cities need to enact to protect future growth. This includes reducing the amount of concrete that creates “heat islands,” expanding parks, and shifting to more drought resistant plants.

    Fortunately, many leaders throughout the Sunbelt, particularly in its cities, are aware of these challenges, and are looking for ways to tackle them. This is driven not by the doomsday environmentalism common in California and Northeast, but grows instead out of a practical concern with stewarding critical resources and creating the right amenities to foster continued growth.

    Combined with basics like lower housing costs and taxes, it’s a common optimism about the future that really underlies the resurgence now occurring from Phoenix to Tampa. The long-term shifts in American power and influence that have been underway since the 1950s have not been halted by the housing bust. Disdained by urban aesthetes, hated by much of the punditry, and largely ignored except for their failings in the media, the Sunbelt seems likely to enjoy the last laugh when it comes to shaping the American future.

    This story originally appeared at The Daily Beast.

    Joel Kotkin is executive editor of NewGeography.com and Distinguished Presidential Fellow in Urban Futures at Chapman University, and a member of the editorial board of the Orange County Register. He is author of The City: A Global History and The Next Hundred Million: America in 2050. His most recent study, The Rise of Postfamilialism, has been widely discussed and distributed internationally. He lives in Los Angeles, CA.

    Houston skyline photo by Bigstock.

  • How Phoenix Housing Boomed and Busted

    When analysing the US housing bubble, four states stand-out for the way in which home values rose into the stratosphere before crashing and burning: California, Nevada, Florida and Arizona (see below chart).


    Since I covered three markets were covered in previous posts at Macrobusiness (see above links), I now want to analyse the Arizona housing market – with particular emphasis on its largest city, Phoenix – to determine why prices bubbled and then burst in such a violent manner.

    In the lead-up to the crash, Phoenix’s economy was booming. New jobs were being added at a fast pace and per capita incomes were growing strongly:



    With confidence riding high on the back of seemingly solid fundamentals and rising asset prices, along with easy access to credit, Arizona households borrowed heavily. Per capita debt accumulation surged in the mid-2000s to levels far in excess of the national average:



    But Phoenix was living on borrowed time. With the national economy turning south in the wake of the sub-prime crisis and the collapse of Lehman Brothers, Phoenix home prices, which had already been falling gradually, began to slide fast. After home prices peaked in May 2006, it took another 18 months before Phoenix’s unemployment rate began rising:



    The rest is history. Home prices continued falling, unemployment kept rising, and nominal per capita incomes fell for the first time in at least 40 years.

    And the pain is widespread, with around one in seven mortgages 90 days in arrears – well in excess of the national average:


    So what went wrong? Could anything have been done differently to prevent the housing bubble/bust?

    Certainly, if credit was less readily available, households would have been constrained in their ability to bid-up prices. But easy credit was only part of the problem. Another key driver of the rampant price escalation and then collapse was the way in which land was supplied for housing.

    Throughout the 2000s, Arizona was one of the fastest growing metropolitan area in the United States with more than 1,000,000 population (see below chart).


    However, despite there being ample developable land on the urban fringe to accomodate this population growth, the actual quantity of land available for development was heavily restricted on two counts:

    1. The State of Arizona passed statewide planning laws in 1998 and 2000, which included the implementation of high impact fees on new development and urban containment devices. In a 2006 study of land-use policies in the 50 largest metropolitan areas of the US, the Brookings Institution ranked Phoenix as ‘growth management’, which is the same ranking as Florida and California.
    2. The overwhelming majority of potential developable land in Arizona is either owned by the state and federal governments, preserved for conservation, or otherwise off-limits to development.

    On the second point – the lack of available land for development – the below graphics highlight the land supply situation in Phoenix.

    First, a pie diagram, extracted from the Arizona State Land Department Annual Report, showing how only 17.5% of land in Arizona is privately owned:


    Second, a map showing the lack of developable land around Phoenix:


    There is evidence that the Arizona State Land Department, whose mission is to “optimize economic return for the Trust beneficiaries”, heavily restricted sales of land to the market in an effort to maximise revenues, causing builders and developers to bid-up land price in period auctions to ensure their supply of land for construction (called ‘land banking’).

    Whereas the price of land for housing sold for around $40,000 per acre immediately prior to the bubble, at the peak average land prices fetched nearly $200,000 (see below chart).


    And with the state rationing the supply of fringe land, average residential land prices rose throughout Arizona:


    Obviously, this land price inflation was a principal cause of the house price escalation as well as the delayed supply response to the rapidly growing population and rising house prices (see below chart).


    Had land around Phoenix been freely available for development, developers would likely not have paid such high prices for the land sold by the state government and Phoenix home prices would never have risen to such heights or crashed as violently.

    Phoenix is yet another example of where excessive government interference in the supply of land has combined with easy credit to create a speculative bubble followed by a painful bust.

    This piece originally appeared at Macrobusiness.

    Leith van Onselen writes daily as the Unconventional Economist at MacroBusiness Australia. He has held positions at the Australian Treasury, Victorian Treasury and currently works at a leading financial services company. Follow him @leithVO.

  • Major Metropolitan Commuting Trends: 2000-2010

    As we indicated in the last article, solo automobile commuting reached an all time record in the United States in 2010, increasing by 7.8 million commuters. At the same time, huge losses were sustained by carpooling, while the largest gain was in working at home, which includes telecommuting. Transit and bicycling also added commuters.  This continues many of the basic trends toward more personalized employment access that we have seen since 1960.

    Solo Automobile Commuting: Among the nation’s 51 metropolitan areas with more than 1 million population, 38 experienced increases in solo automobile commuting between 2000 and 2010. More than 80% of commuting is by solo automobile in 25 of the 51 largest metropolitan areas, with the highest rates being in Birmingham, Detroit, Cincinnati, Indianapolis and Kansas City. Another 28 metropolitan areas have single automobile commute shares of between 70% and 80%, with Boston, Washington and San Francisco between 60% and 70%. As would be expected, the lowest solo automobile commute share was in New York at 51%.

    Car Pools: The national data also showed a nearly 2.4 million loss in carpool use. The losses were pervasive, occurring in all 51 metropolitan areas. Riverside-San Bernardino had the highest carpool market share at just under 15%, while all other major metropolitan areas were below 12%. Car pools have been losing market share for decades.

    Work at Home (Includes Telecommuting): In what we have previously labeled as The Decade of the Telecommute, the nation experienced a 1.7 million increase in working at home over the past decade. The market share gains in working at home were as pervasive as the losses in carpooling, with all 51 metropolitan areas registering increases. Austin had the strongest work-at-home market share, at 7.3%, followed by Portland at 6.5%, San Francisco and Denver at 6.2%, Phoenix at 6.0%, with San Diego, Raleigh and Atlanta above 5.5%. Overall, working at home exceeded transit commuting in 37 major metropolitan areas out of 51 in 2010, up from 27 in 2000. Three metropolitan areas had work at home market shares of less than 3%, including Memphis, New Orleans and last place Buffalo.

    Transit: As noted before, transit enjoyed its first 10 year gain since journey to work data was first collected by the Census Bureau 50 years ago. Overall, transit added 900,000 daily commuters, roughly half that for telecommuters. Transit’s market share increased in 25 of the top 51 metropolitan areas. It is also notable that in a number of the metropolitan areas with the largest expenditures for new rail systems, there were either losses or commuting gains were concentrated in the more flexible bus services.

    New York: As so often has been the case, transit was largely a "New York story." More than one half of the new transit commuters were in the New York metropolitan area, more than 450,000 of the 900,000 increase. New York boasts by far the most extensive transit system in the nation, which serves the second largest central business district in the world and by far the nation’s most important. In 2000, New York had a transit work trip market share of 27.4%. By 2010, New York’s transit work trip market share had risen to 30.7%, more than double that of any other metropolitan area. More than 70% of the new transit commuters in the New York area were on its subway (Metro), suburban rail and light rail systems.

    San Francisco: San Francisco retained its position as the second strongest transit metropolitan area, with a 14.6% work trip market share in 2010. This is up from 13.8% in 2000.

    Washington: Washington was the third strongest transit commuting market, with a 14.0% work trip market share in 2010. This modest increase from 13.4% nonetheless produced the second largest ridership increase in the nation, at more than 130,000. This reflects the strength of Washington’s job market over the decade. Rail ridership accounted for 53% of this increase, while buses accounted for the other 47%.

    Boston and Chicago: Boston passed Chicago to become the fourth strongest transit market, at 11.8% in 2010. This is an increase from 11.2% in 2000. Chicago ranked fifth at 11.2%, a small reduction from the 11.3% in 2000.

    Los Angeles: Los Angeles had the third largest increase in transit commuting, adding 60,000 daily transit commuters. Approximately 75% of these new commuters were attracted by the region’s extensive bus system as opposed to its very expensive but limited rail system. This increase placed Los Angeles in a virtual tie with Portland, with a work trip market share of 6.2%.

    Portland: Portland continued to experience its now 30 year transit market share erosion, despite having added three new light rail lines between 2000 and 2010. Portland’s transit work trip market share fell to 6.2% from 6.3% and now trails the work at home and telecommute market share of 6.5%.

    Seattle:Seattle added 29,000 new transit commuters for the fourth strongest growth in the nation. Approximately 75% of the new commuters were on the metropolitan area’s bus system.

    Atlanta: Atlanta, which is home to the third largest postwar Metro system in the nation (MARTA) gained nearly 9000 new transit commuters, all of them on the bus, while losing more than 3000 rail commuters.

    Miami:Miami added 16,000 new transit commuters, though more than 90% were attracted to the bus system, rather than the rail services.

    Rail and Bus in Texas: Other metropolitan areas with new and expanded rail systems did not fare as well. In Dallas-Fort Worth, the light rail system was more than doubled in length, yet there was a reduction of more than 3000 daily transit commuters. The transit work trip market share in Dallas-Fort Worth dropped from 1.8% to 1.4%, approximately one quarter lower than that of any other major metropolitan area with a new light rail or Metro system. Houston, which built its first light rail line during the period, lost nearly 3000 daily transit commuters, with its transit work trip market share dropping by nearly one-third, from 3.2% to 2.3%. By contrast, the third largest metropolitan area in Texas, San Antonio, lost no commuters from its bus only transit system.

    Other New Rail Metropolitan Areas: Other metropolitan areas with new rail systems experienced modest ridership increases, with 60 to 70 percent of the increase on the bus systems in Charlotte, Minneapolis-St. Paul and Phoenix. Salt Lake City experienced a small decline in transit commuting.

    Below 1 Percent: Four metropolitan areas had transit work trip market shares of less than 1%, including Indianapolis, Raleigh, Birmingham and last place Oklahoma City, with a market share of 0.4%.

    Bicycles: It was also a good decade for bicycle commuting, with the national increase of nearly 250,000. The bicycle commuting market share rose in 45 of the 51 largest metropolitan areas. Portland had the highest bicycle market share at 2.2%, with three other metropolitan areas at 1.5% or above, Sacramento, San Francisco and San Jose. The lowest bicycle commuting market shares were in San Antonio, Cincinnati, Birmingham and Memphis, all at 0.1 percent.

    Walking: There was little change in walking among the nations major metropolitan areas. The largest shares were in New York (5.9%) and Boston (5.4%), with the smallest shares in Raleigh (1.1%), Orlando (1.1%) and Birmingham (1.0%).

    Drifting Away from Shared Commuting: In some ways, the 2000s were different than previous decades, especially with the reversals in bicycle commuting and transit. However, overall, shared ride commuting (transit and car pools) lost share due to the precipitous decline in car pooling. Longer term share increase trends also continued in single-occupant automobile commuting and working at home. The bottom line: personal employment access (personal mobility plus working at home) continues to carve away at the smallish share still held by shared commuting.

    ————-

    Data: The 2000 and 2010 commuting market shares by mode are shown in Tables 1 and 2 (2010 metropolitan area boundaries).

    ————

    Table 1
    Work Trip Market Share: 2000
    Metropolitan Areas Over 1,000,000 Population in 2010
    Metropolitan Area Car, Truck or Van: Alone Car/Van Pool Transit Bicycle Walk Other Work at Home (Includes Telecommute)
    Atlanta 77.0% 13.7% 3.4% 0.1% 1.3% 1.1% 3.5%
    Austin 76.5% 13.7% 2.5% 0.6% 2.1% 1.1% 3.6%
    Baltimore 75.5% 11.5% 5.9% 0.2% 2.9% 0.9% 3.2%
    Birmingham 83.3% 12.0% 0.7% 0.1% 1.2% 0.7% 2.1%
    Boston 71.1% 8.6% 11.2% 0.5% 4.6% 0.8% 3.3%
    Buffalo 81.7% 9.4% 3.3% 0.2% 2.7% 0.5% 2.1%
    Charlotte 80.7% 12.8% 1.4% 0.1% 1.2% 0.8% 2.9%
    Chicago 70.4% 11.0% 11.3% 0.3% 3.1% 1.0% 2.9%
    Cincinnati 81.3% 10.1% 2.8% 0.1% 2.3% 0.6% 2.7%
    Cleveland 81.3% 8.8% 4.1% 0.2% 2.2% 0.6% 2.7%
    Columbus 82.1% 9.7% 2.1% 0.2% 2.3% 0.6% 3.0%
    Dallas-Fort Worth 78.7% 13.9% 1.8% 0.1% 1.5% 1.0% 3.0%
    Denver 76.0% 11.7% 4.4% 0.4% 2.1% 0.8% 4.6%
    Detroit 84.7% 9.2% 1.7% 0.1% 1.4% 0.6% 2.2%
    Hartford 82.6% 8.7% 2.8% 0.2% 2.5% 0.6% 2.6%
    Houston 77.0% 14.3% 3.2% 0.3% 1.6% 1.1% 2.5%
    Indianapolis 82.8% 10.4% 1.3% 0.2% 1.7% 0.7% 3.0%
    Jacksonville 80.3% 12.6% 1.3% 0.5% 1.7% 1.4% 2.3%
    Kansas City 82.6% 10.6% 1.2% 0.1% 1.4% 0.7% 3.5%
    Las Vegas 74.6% 14.7% 4.4% 0.5% 2.3% 1.3% 2.3%
    Los Angeles 71.9% 14.6% 5.6% 0.7% 2.7% 1.0% 3.5%
    Louisville 81.8% 11.2% 2.0% 0.2% 1.7% 0.7% 2.5%
    Memphis 80.7% 13.3% 1.6% 0.1% 1.3% 0.9% 2.2%
    Miami-West Palm Beach 77.3% 13.1% 3.2% 0.5% 1.7% 1.2% 3.1%
    Milwaukee 79.7% 9.9% 4.2% 0.2% 2.9% 0.6% 2.6%
    Minneapolis-St. Paul 78.3% 10.0% 4.4% 0.4% 2.4% 0.6% 3.8%
    Nashville 80.5% 13.1% 0.8% 0.1% 1.5% 0.8% 3.2%
    New Orleans 72.9% 14.6% 5.4% 0.6% 2.7% 1.3% 2.4%
    New York 52.7% 9.3% 27.4% 0.3% 6.0% 1.5% 2.9%
    Oklahoma City 81.6% 12.1% 0.5% 0.2% 1.7% 1.0% 2.9%
    Orlando 80.6% 12.1% 1.6% 0.4% 1.3% 1.1% 2.9%
    Philadelphia 73.1% 10.2% 8.9% 0.3% 3.9% 0.7% 2.9%
    Phoenix 74.6% 15.3% 1.9% 0.9% 2.1% 1.4% 3.7%
    Pittsburgh 77.5% 9.8% 5.9% 0.1% 3.6% 0.6% 2.5%
    Portland 73.1% 11.5% 6.3% 0.8% 2.9% 0.8% 4.6%
    Providence 80.7% 10.5% 2.4% 0.2% 3.3% 0.8% 2.2%
    Raleigh 80.8% 12.1% 0.9% 0.2% 1.6% 1.0% 3.5%
    Richmond 81.7% 10.9% 1.9% 0.2% 1.8% 0.8% 2.7%
    Riverside-San Bernardino 73.5% 17.6% 1.6% 0.5% 2.2% 1.2% 3.5%
    Rochester 81.7% 9.1% 2.0% 0.2% 3.5% 0.6% 2.9%
    Sacramento 75.3% 13.5% 2.7% 1.4% 2.2% 0.9% 4.0%
    Salt Lake City 76.0% 13.4% 3.3% 0.5% 2.1% 0.7% 4.0%
    San Antonio 76.2% 14.9% 2.7% 0.1% 2.4% 1.2% 2.6%
    San Diego 73.9% 13.0% 3.3% 0.6% 3.4% 1.4% 4.4%
    San Francisco-Oakland 62.8% 12.7% 13.8% 1.1% 3.9% 1.3% 4.3%
    San Jose 77.2% 12.4% 3.4% 1.2% 1.8% 0.9% 3.1%
    Seattle 71.6% 12.7% 7.0% 0.6% 3.1% 0.8% 4.2%
    St. Louis 82.5% 10.0% 2.2% 0.1% 1.7% 0.6% 2.9%
    Tampa-St. Petersburg 79.7% 12.4% 1.3% 0.6% 1.7% 1.2% 3.1%
    Virginia Beach-Norfolk 78.8% 12.1% 1.7% 0.3% 2.7% 1.6% 2.7%
    Washington 67.5% 13.4% 11.2% 0.3% 3.0% 0.9% 3.7%
    Top 51 Metropolitan Areas 73.2% 11.8% 7.5% 0.4% 2.9% 1.0% 3.2%
    Calculated from Census Bureau data
    Metropolitan areas as defined in 2010
    Table 2
    Work Trip Market Share: 2010
    Metropolitan Areas Over 1,000,000 Population in 2010
    Car, Truck or Van: Alone Car/Van Pool Transit Bicycle Walk Other Work at Home (Includes Telecommute)
    Atlanta 77.6% 10.3% 3.4% 0.2% 1.3% 1.5% 5.8%
    Austin 75.6% 10.5% 2.3% 0.6% 1.9% 1.8% 7.3%
    Baltimore 76.5% 9.6% 6.0% 0.2% 2.6% 1.0% 4.1%
    Birmingham 84.8% 10.0% 0.6% 0.1% 1.0% 0.5% 3.1%
    Boston 69.5% 7.5% 11.8% 0.7% 5.4% 0.8% 4.4%
    Buffalo 82.0% 7.5% 3.8% 0.3% 3.0% 1.1% 2.3%
    Charlotte 80.6% 10.0% 2.0% 0.2% 1.5% 0.6% 5.1%
    Chicago 71.0% 8.5% 11.2% 0.6% 3.1% 1.0% 4.5%
    Cincinnati 84.1% 7.9% 2.1% 0.1% 2.0% 0.4% 3.4%
    Cleveland 82.3% 7.2% 3.6% 0.3% 2.2% 0.7% 3.7%
    Columbus 82.4% 8.0% 1.7% 0.5% 2.3% 0.6% 4.6%
    Dallas-Fort Worth 81.3% 10.1% 1.4% 0.2% 1.2% 1.4% 4.6%
    Denver 76.3% 9.6% 4.1% 0.8% 1.9% 1.1% 6.2%
    Detroit 84.6% 8.5% 1.5% 0.2% 1.4% 0.8% 3.0%
    Hartford 81.5% 7.9% 3.1% 0.3% 3.0% 1.0% 3.2%
    Houston 79.4% 11.5% 2.3% 0.3% 1.4% 1.7% 3.4%
    Indianapolis 83.9% 8.2% 0.9% 0.3% 1.5% 0.8% 4.3%
    Jacksonville 82.5% 8.9% 1.0% 0.5% 1.4% 1.2% 4.5%
    Kansas City 83.7% 8.5% 1.2% 0.2% 1.4% 0.9% 4.1%
    Las Vegas 78.9% 10.5% 3.8% 0.6% 1.6% 1.3% 3.3%
    Los Angeles 73.5% 10.7% 6.2% 0.9% 2.6% 1.2% 5.0%
    Louisville 83.5% 9.2% 1.9% 0.2% 1.3% 0.9% 3.1%
    Memphis 83.6% 10.3% 1.0% 0.1% 1.5% 0.9% 2.7%
    Miami-West Palm Beach 78.8% 9.4% 3.5% 0.6% 2.0% 1.4% 4.4%
    Milwaukee 80.1% 9.3% 3.4% 0.5% 2.6% 0.7% 3.4%
    Minneapolis-St. Paul 78.3% 7.9% 4.8% 0.7% 2.4% 0.9% 4.9%
    Nashville 81.3% 10.7% 1.0% 0.2% 1.2% 1.0% 4.6%
    New Orleans 78.1% 11.0% 3.2% 0.7% 2.6% 1.9% 2.5%
    New York 50.5% 6.8% 30.7% 0.5% 5.9% 1.6% 3.9%
    Oklahoma City 82.7% 10.6% 0.5% 0.3% 1.6% 1.0% 3.4%
    Orlando 82.1% 9.2% 1.6% 0.3% 1.1% 1.4% 4.4%
    Philadelphia 73.9% 8.0% 9.6% 0.5% 3.5% 0.8% 3.8%
    Phoenix 76.7% 11.8% 2.0% 0.6% 1.5% 1.5% 6.0%
    Pittsburgh 77.0% 8.9% 5.6% 0.3% 3.7% 0.9% 3.5%
    Portland 72.1% 8.8% 6.2% 2.2% 3.3% 0.9% 6.5%
    Providence 81.3% 8.3% 2.6% 0.5% 3.2% 0.9% 3.2%
    Raleigh 82.0% 8.7% 0.9% 0.3% 1.1% 1.1% 5.9%
    Richmond 81.2% 10.1% 1.8% 0.4% 1.2% 0.7% 4.6%
    Riverside-San Bernardino 76.1% 14.8% 1.7% 0.4% 1.8% 1.4% 3.8%
    Rochester 82.6% 7.1% 1.8% 0.4% 3.9% 0.7% 3.6%
    Sacramento 75.6% 11.2% 2.9% 1.7% 1.9% 1.1% 5.5%
    Salt Lake City 77.7% 11.3% 2.9% 0.8% 2.3% 1.0% 4.0%
    San Antonio 79.5% 11.5% 2.1% 0.1% 2.0% 1.4% 3.3%
    San Diego 76.2% 10.1% 3.3% 0.8% 2.8% 1.0% 5.9%
    San Francisco-Oakland 61.5% 10.6% 14.6% 1.7% 4.2% 1.2% 6.2%
    San Jose 77.5% 10.3% 2.9% 1.6% 1.8% 0.9% 5.1%
    Seattle 70.5% 10.2% 8.2% 1.1% 3.5% 1.0% 5.5%
    St. Louis 83.0% 7.7% 2.6% 0.2% 1.9% 0.8% 3.7%
    Tampa-St. Petersburg 80.3% 9.5% 1.6% 0.8% 1.4% 1.4% 5.0%
    Virginia Beach-Norfolk 80.9% 9.4% 1.8% 0.5% 3.3% 0.9% 3.1%
    Washington 65.6% 10.6% 14.0% 0.5% 3.5% 1.0% 4.9%
    Top 51 Metropolitan Areas 73.7% 9.4% 7.9% 0.6% 2.8% 1.2% 4.4%
    Calculated from Census Bureau data
    Metropolitan areas as defined in 2010

    Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris and the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life”

    Photo: Manhattan (New York), with the Woolworth Building in the distance (by author)

  • Biggest Boomer Towns

    The boomer generation, spawned (literally) in the aftermath of the Second World War, will continue to shape the American landscape well into the 21st Century. They may be getting older, but these folks are still maintaining their power. Those born in the first ten years of the boomer generation  — between 1945 and 1955 — number 36 million, and they will continue to influence communities and real estate markets across the country, especially as they contemplate life after kids and retirement.

    Much has been written about where “empty nesters” might move as their children move off on their own. One longstanding favorite is the notion that, having jettisoned their children, the boomers will also desert their suburban communities for the bright city lights.

    Unfortunately for developers — some of whom have invested heavily in high-end housing for urbanizing “empty nesters” — the actual data do not support this thesis. Indeed, our analysis of migration by this cohort in the past 10 years shows a 10.3% decline among core city dwellers, a loss of some 1.3 million people over the past decade. For this analysis, Forbes, with the help of demographer Wendell Cox, looked at population numbers from the Census for boomers aged 45 to 54 in 2000 and compared them with the numbers for those ages 55 to 64 in 2010.

    These population changes include reductions due principally to deaths. Census data do not include mortality information. This cohort lost 3.2% of its population over the 10 years. This would only marginally reduce the changes between 2000 and 2010, while the scale of differences between the metropolitan areas would be identical.

    So where are these surviving boomers settling as they enter their likely extended golden years?  The results may surprise urban boosters who have confidently expected them to flock downtown.

    To be sure, a few of the highly affluent — the ones mentioned in the mainstream media — may purchase homes, or pied-à-terres, in places like Manhattan, Chicago’s Gold Coast or San Francisco. But these areas actually have suffered an exodus of boomers over the past decade. In our ranking of the 51 largest metros in the U.S., the urban cores of San Jose, San Francisco, Los Angeles and Chicago scored near the bottom, suffering double-digit percentage losses of boomers. According to the last Census, New York’s urban core, which the Daily News suggested is packed with aspiring seniors, lost 12% of boomers in their mid-50s to mid-60s  — or about 274,000 people.

    Over the past three years  you could blame this loss on the economy, which has postponed retirements brought home many of the boomers’ young, largely unemployed or underemployed children back to the suburban homestead. Or you can credit it to more active lifestyles among boomers who appear to working later than ever. According to a Careerbuilder.com survey, over 60% of workers over 60 indicated they are postponing retirement.

    Yet perhaps something more profound is at work here. An analysis of those who were 55 to 65 in 2000 and 65 to 75 in 2010 reveals an even stronger anti-urban bias, with an over 12% drop in city dwellers. Since these folks are far less likely to have kids at home and more properly retired, this cohort’s behavior suggests that aging boomers are if anything less likely to move to the cities in the next decade.

    Indeed, if boomers do move, notes Sandi Rosenbloom, a noted expert on retirement trends and professor of Planning and Civil Engineering at the University of Arizona, they tend to move to less dense and more affordable regions. The top cities for aging boomers largely parallel those that appealed to the “young and restless” in our earlier survey. The top ten on our list are all affordable, generally low-density Sun Belt metros:

    1. Las Vegas, Nev.
    2. Phoenix, Ariz.
    3. Tampa-St. Petersburg, Fla.
    4. Orlando, Fla.
    5. Riverside-San Bernardino, Calif.
    6. Raleigh, N.C.
    7. Austin, Texas
    8. San Antonio, Texas
    9. Jacksonville, Fla.
    10. Charlotte, N.C.-S.C.

    But according Sandi Rosenbloom, a noted expert on retirement trends and a professor of planning and civil engineering at the University of Arizona, most boomers are staying put, largely in the suburbs they settled in decades ago.  The propensity to move, she points out, starts to drop precipitously as people leave their early 30s. Roughly 1 in 3 people in their 20s move in a given year; by the time they enter their 40s, that figure slides to about 1 in 10. As people age into their 50s and beyond, the percentage drops to roughly 5%, or 1 in 20.

    “The boomers are staying put more than anyone thought,” Rosenbloom says. “People of that generation tend to own their own homes and stay there. The idea that they are moving to the city really comes from the wishful thinking school of planning.”

    The recession has exacerbated this stay-at-home trend. The number of people moving is at its lowest level since the early 1960s. When boomers do decide to move, Rosenbloom notes, they do so largely for prosaic reasons, such as being closer to children or, more important, grandchildren.

    Others succumb to the temptation to cash out expensive housing in metros like New York, Los Angeles, the Bay Area or Boston for less costly residences in Sun Belt locales. Housing in and around these core cities, particularly in attractive neighborhoods, Rosenbloom adds, are simply too expensive for the vast majority of budget-conscious seniors.

    Much of this also has to do with the lifestyle preferences of both boomers and seniors, which appear far different than those put forth by urban pundits. People over 55 that Rosenbloom has interviewed usually express a preference to stay or relocate in places that are less crowded and congested. Furthermore, most are reluctant to give up their cars, and many are less able to walk than drive. This may explain why most retirement communities end up on the urban fringe or farther.

    This trend — which Rosenbloom has also encountered in the U.K., Australia, Canada and New Zealand — is also reflected by the growing shift to smaller towns and cities among both aging boomers and seniors. The “young and restless” may head to suburbs, particularly in the lower-cost Sun Belt cities, but some older Americans appear headed to even less densely populated regions. Over the past decade over 1 million aging boomers and seniors moved to more smaller cities and rural locations from suburban or urban locations.

    What do these trends suggest for the future of our communities and real estate? For one, the big opportunities for selling to aging boomers will remain primarily in the suburbs and some select more rural locations. We also can expect the new senior citizens to move to more affordable places close to their children.

    These findings do provide some long-term hope for the housing market, particularly in suburbs. Leading demographers have been busy predicting a massive drop-off in single-family homes as boomers retire and their children leave. Yet our analysis on the Census reveals that most boomers — as well as those older than them — are staying in the suburbs a lot longer than expected. Many will likely to stay in their homes and old neighborhoods well into their 70s or even 80s, leaving either their home either in an ambulance or to an assisted living facility.

    Developers and planners anxious to service aging boomers should, instead of building downtown towers, address the needs of this generation precisely where they now live and are likely to stay. This could include adding to new residential options in the suburbs to enlivening local shopping districts while boosting senior services in everything from recreation and public safety to health care. As the rock and roll generation heads toward its dotage, both business and communities need to adjust their strategies based not on fantasies but on the realities so clearly evidenced by the Census.

    This piece originally appeared at Forbes.com.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

  • The Next Boom Towns In The U.S.

    What cities are best positioned to grow and prosper in the coming decade?

    To determine the next boom towns in the U.S., with the help of Mark Schill at the Praxis Strategy Group, we took the 52 largest metro areas in the country (those with populations exceeding 1 million) and ranked them based on various data indicating past, present and future vitality.

    We started with job growth, not only looking at performance over the past decade but also focusing on growth in the past two years, to account for the possible long-term effects of the Great Recession. That accounted for roughly one-third of the score.  The other two-thirds were made up of a a broad range of demographic factors, all weighted equally. These included rates of family formation (percentage growth in children 5-17), growth in educated migration, population growth and, finally, a broad measurement of attractiveness to immigrants — as places to settle, make money and start businesses.

    We focused on these demographic factors because college-educated migrants (who also tend to be under 30), new families and immigrants will be critical in shaping the future.  Areas that are rapidly losing young families and low rates of migration among educated migrants are the American equivalents of rapidly aging countries like Japan; those with more sprightly demographics are akin to up and coming countries such as Vietnam.

    Many of our top performers are not surprising. No. 1 Austin, Texas, and No. 2 Raleigh, N.C., have it all demographically: high rates of immigration and migration of educated workers and healthy increases in population and number of children. They are also economic superstars, with job-creation records among the best in the nation.

    Perhaps less expected is the No. 3 ranking for Nashville, Tenn. The country music capital, with its low housing prices and pro-business environment, has experienced rapid growth in educated migrants, where it ranks an impressive fourth in terms of percentage growth. New ethnic groups, such as Latinos and Asians, have doubled in size over the past decade.

    Two advantages Nashville and other rising Southern cities like No. 8 Charlotte, N.C., possess are a mild climate and smaller scale. Even with population growth, they do not suffer the persistent transportation bottlenecks that strangle the older growth hubs. At the same time, these cities are building the infrastructure — roads, cultural institutions and airports — critical to future growth. Charlotte’s bustling airport may never be as big as Atlanta’s Hartsfield, but it serves both major national and international routes.

    Of course, Texas metropolitan areas feature prominently on our list of future boom towns, including No. 4 San Antonio, No. 5 Houston and No. 7 Dallas, which over the past years boasted the biggest jump in new jobs, over 83,000. Aided by relatively low housing prices and buoyant economies, these Lone Star cities have become major hubs for jobs and families.

    And there’s more growth to come. With its strategically located airport, Dallas is emerging as the ideal place for corporate relocations. And Houston, with its burgeoning port and dominance of the world energy business, seems destined to become ever more influential in the coming decade. Both cities have emerged as major immigrant hubs, attracting on newcomers at a rate far higher than old immigrant hubs like Chicago, Boston and Seattle.

    The three other regions in our top 10 represent radically different kinds of places. The Washington, D.C., area (No. 6) sprawls from the District of Columbia through parts of Virginia, Maryland and West Virginia. Its great competitive advantage lies in proximity to the federal government, which has helped it enjoy an almost shockingly   ”good recession,” with continuing job growth, including in high-wage science- and technology-related fields, and an improving real estate market.

    Our other two top ten, No. 9 Phoenix, Ariz., and No. 10 Orlando, Fla., have not done well in the recession, but both still have more jobs now than in 2000. Their demographics remain surprisingly robust. Despite some anti-immigrant agitation by local politicians, immigrants still seem to be flocking to both of these states. Known better s as retirement havens, their ranks of children and families have surged over the past decade. Warm weather, pro-business environments and, most critically, a large supply of affordable housing should allow these regions to grow, if not in the overheated fashion of the past, at rates both steadier and more sustainable.

    Sadly, several of the nation’s premier economic regions sit toward the bottom of the list, notably former boom town Los Angeles (No. 47). Los Angeles’ once huge and vibrant industrial sector has shrunk rapidly, in large part the consequence of ever-tightening regulatory burdens. Its once magnetic appeal to educated migrants faded and families are fleeing from persistently high housing prices, poor educational choices and weak employment opportunities. Los Angeles lost over 180,000 children 5 to 17, the largest such drop in the nation.

    Many of L.A.’s traditional rivals — such as Chicago (with which is tied at No. 47), New York City (No. 35) and San Francisco (No. 42) — also did poorly on our prospective list.  To be sure,  they will continue to reap the benefits of existing resources — financial institutions, universities and the presence of leading companies — but their future prospects will be limited by their generally sluggish job creation and aging demographics.

    Of course, even the most exhaustive research cannot fully predict the future. A significant downsizing of the federal government, for example, would slow the D.C. region’s growth. A big fall in energy prices, or tough restrictions of carbon emissions, could hit the Texas cities, particularly Houston, hard. If housing prices stabilize in the Northeast or West Coast, less people will flock to places like Phoenix, Orlando or even Indianapolis (No.11) , Salt Lake City (No. 12) and Columbus (No. 13). One or more of our now lower ranked locales, like Los Angeles, San Francisco and New York, might also decide to reform in order to become more attractive to small businesses and middle class families.

    What is clear is that well-established patterns of job creation and vital demographics will drive future regional growth, not only in the next year, but over the coming decade.  People create economies and they tend to vote with their feet when they choose to locate their families as well as their businesses.  This will prove   more decisive in shaping future growth   than the hip imagery and big city-oriented PR flackery that dominate media coverage of America’s changing regions.

    Cities of the Future Rankings
    Rank Metropolitan Area
    1 Austin, TX
    2 Raleigh, NC
    3 Nashville, TN
    4 San Antonio, TX
    5 Houston, TX
    6 Washington, DC-VA-MD-WV
    7 Dallas-Fort Worth, TX
    8 Charlotte, NC-SC
    8 Phoenix, AZ
    10 Orlando, FL
    11 Indianapolis, IN
    12 Salt Lake City, UT
    13 Columbus, OH
    14 Jacksonville, FL
    15 Atlanta, GA
    16 Las Vegas, NV
    16 Riverside, CA
    18 Portland, OR-WA
    19 Denver, CO
    20 Oklahoma City, OK
    21 Baltimore, MD
    22 Louisville, KY-IN
    22 Richmond, VA
    24 Seattle, WA
    25 Kansas City, MO-KS
    26 San Diego, CA
    27 Miami, FL
    28 Tampa, FL
    29 Sacramento, CA
    30 Birmingham, AL
    31 New Orleans, LA
    32 Philadelphia, PA-NJ-DE-MD
    33 Minneapolis, MN-WI
    34 St. Louis, MO-IL
    35 Cincinnati, OH-KY-IN
    35 New York, NY-NJ-PA
    37 Boston, MA-NH
    38 Memphis, TN-MS-AR
    39 Pittsburgh, PA
    40 Virginia Beach, VA-NC
    41 Rochester, NY
    42 Buffalo, NY
    42 San Francisco, CA
    44 Hartford, CT
    45 Milwaukee, WI
    45 San Jose, CA
    47 Chicago, IL-IN-WI
    47 Los Angeles, CA
    49 Providence, RI-MA
    50 Detroit, MI
    51 Cleveland, OH

    This piece originally appeared at Forbes.com.

    Joel Kotkin is executive editor of NewGeography.com and is a distinguished presidential fellow in urban futures at Chapman University, and an adjunct fellow of the Legatum Institute in London. He is author of The City: A Global History. His newest book is The Next Hundred Million: America in 2050, released in February, 2010.

    Photo by Exothermic Photography

  • Rethinking Urban Dynamics: Lessons from the Census

    Much has been made of the vaunted “back to the city” movement by “the young and restless,” young professionals, the creative class, empty nesters and others were voting with their feet in favor of cities over suburbs.  Although there were bright spots, the Census 2010 results show that the trend was very overblown, affecting mostly downtown and near downtown areas, while outlying ones bled population.  One culprit for this discrepancy seems to be that the intra-census estimates supplied by the Census Bureau were inflated – in some cases very inflated.

    Looking at selected core cities for major US metropolitan areas, many of them were materially over-estimated:


    One particularly egregious case relates to Atlanta. Its huge projected population increase in the 2000s led me to describe it as “one of America’s top urban success stories.”  The reality proved to be quite different. Rather than strong population growth in the city, the population growth turned out to be basically flat, quite a different story.  Other declines might be more predictable, such as Detroit, or those who had previously challenged estimates like Cincinnati and St. Louis.  Still, even urban cores in rapidly growing regions like Dallas and Houston were not immune from this trend.

    There were some exceptions. Cities like Indianapolis, Columbus, and Oklahoma City came in slightly ahead of expectations, but the number of cities with misses and the sizes of the positive and negative misses tilted towards the down direction.

    It seems clear now that the justification for much of the “back to the city” story reflected bad estimates. People can’t be faulted for relying on the official government numbers – I did. But the reality of the 2010 Census, as demonstrated by Wendell Cox and others, is that the 1990s were actually better for urban population growth in America than the 2000s in many respects.

    One legitimate bright spot for cities lay in the growth of downtown and near downtown areas.  Though often starting from low bases, these areas often showed impressive increases.  For example, St. Louis showed good growth downtown despite a very disappointing decline in total city population:

    The poster child for this phenomenon was Chicago, where a fairly expansive area in the greater core showed large population growth.  Areas that were formerly almost all commercial, such as the Loop, added significant residential population, while areas that were nearly derelict like the near South Side have blossomed into thriving upscale neighborhoods.




    The problem, from places ranging from Chicago to Cleveland, is that the gains in the “core of the core” have been more than offset by losses elsewhere, especially the flight of blacks and other minorities – many of them immigrants – to the increasingly diverse suburbs.

    Cities across America have invested enormous sums into downtown redevelopment and major projects in selected districts.  The good news: these investments have shown some ability to move the needle in terms of attracting young professionals downtown.  The bad news lies with the fact that these developments have been extremely costly, and have not transformed the overall demographic or economic climates of the cities that tried them.  This demonstrates the limits of the policies.  Those who aren’t in the young professional, empty nester, or creative class demographic have rightly figured out that they are no longer the target market of city leadership. No surprise then that many of them    have decided to vote with their feet.

    Given the resulting overall negative swings, cities may want to revisit their strategy of putting all their chips in the downtown redevelopment basket in favor of less glamorous improvements in basic neighborhood safety, services, schools and other critical elements.  A handful of elite enclaves and talent hubs may be able to thrive on a “favored demographic quarter” strategy, but for most places there just aren’t enough young professionals and artists to go around.

    Aaron M. Renn is an independent writer on urban affairs based in the Midwest. His writings appear at The Urbanophile.

    * Actual population minus projected population as of 4/1/2010 using a run rate projection based on the 2008-2009 estimated population growth.
    ** Base is the projected 4/1/2010 population above.

    Photo by Ian Freimuth

  • Phoenix Population Counts Lower than Expected

    The 2009 Census Bureau estimates indicated that Phoenix had become the nation’s 12th largest metropolitan area, passing San Francisco and Riverside-San Bernardino since 2000. The census count for 2010 indicates that Phoenix remains the 14th largest metropolitan area and failed to pass either San Francisco or Riverside-San Bernardino during the decade.

    Nonetheless, Phoenix grew rapidly, adding 28.9 percent to its population. The metropolitan area had 4,193,000 residents in 2010, up from 3,252,000 in 2000.

    The historical core municipality of Phoenix also grew less than expected. The 2009 Census Bureau estimates placed the population at 1,570,000, having passed Philadelphia to become the nation’s fifth largest municipality. The city of Phoenix has a near universal suburban form, with a land area 520 square miles, four times that of Philadelphia. The 2010 census count was far smaller than expected, at 1,446,000, up from 1,332,000 in 2000, but still well below Philadelphia’s 1,526,000. The 124,000 gain was the smallest of any census period since 1940-1950, at the end of which the city had 107,000 residents. The population growth rate was 9.3 percent, the lowest percentage increase rate since the 1880-1890 census period. The city of Phoenix captured 13 percent of the metropolitan growth, down from 33 percent in the 1990-2000 census period.

    Suburban population growth was much stronger, at 42.4 percent. Suburban Pima County doubled in size and its exurban municipalities experienced strong growth. The city of Maricopa grew by 4,000 percent, from 1,000 to 43,000. Casa Grande nearly doubled in size. Suburbs within the core county of Maricopa also grew quickly. Buckeye, the last urbanization for 100 miles west on Interstate 10 grew from 7,000 to 51,000. Other urban fringe or near-urban fringe municipalities also grew quickly, such as Gilbert (109,000 to 209,000), Surprise (31,000 to 117,000) and Goodyear (19,000 to 65,000). The suburbs captured 87 percent of the metropolitan area growth, up from 67 percent in the 1990s.

  • Regional Exchange Rates: The Cost of Living in US Metropolitan Areas

    International travelers and expatriates have long known that currency exchange rates are not reliable indicators of purchasing power. For example, a traveler to France or Germany will notice that the dollar equivalent in Euros cannot buy as much as at home. Conversely, the traveler to China will note that the dollar equivalent in Yuan will buy more.

    Economists have attempted to solve this problem by developing "purchasing power parities," which are used to estimate currency conversion rates that equalize values based upon prices (Note 1). This helps establish the real value of money in a particular place.

    When people move from one region of the United States to another they can encounter a similar phenomenon. For example, a dollar is not worth as much in San Jose as it is in St. Louis. Research by the US Department of Commerce Bureau of Economic Analysis (BEA), for example, found that in 2006 a dollar purchased roughly 35 cents less in San Jose than in St. Louis. BEA researchers estimated "regional price parities" for states and the District of Columbia and for all of the nation’s metropolitan areas (Note 2). Regional price parities can be thought of as the equivalent of regional (state or metropolitan area) exchange rates. This research was covered in previous newgeography.com articles by Eamon Moynihan and this author.

    This article uses Department of Labor, Bureau of Labor Statistics metropolitan area consumer price indexes to estimate the 2009 cost of living and per capita personal income adjusted for the cost of living.

    Cost of Living: At the regional level (See Census Region Map, Figure 1), there are substantial differences in the cost of living (Figure 2). The lowest cost of living is in the Midwest, at 4.8 percent below the nation. The South has the second lowest cost of living at 3.9 percent above the national level. The West is the most expensive area, 13.5 percent above the national cost-of-living, while the Northeast’s cost-of-living stands 11.3 percent above the national rate.

    The cost of living in the South may seem higher than expected. But if the higher cost metropolitan areas of Washington, Baltimore and Miami are excluded, the cost of living in the South falls to 1.5 percent below the national rate. If the California metropolitan areas are excluded from the West, the cost of living still remains 4.0 percent above the national rate.

    Per Capita Income: The highest unadjusted per capita incomes are in the Northeast, followed by the West, the South and the Midwest. Yet when metropolitan area exchange rates are taken into consideration, the order changes significantly. The Northeast remains the most affluent, and the Midwest moves from last place to second place. The South is in third place, the same as its income rating, while the West falls from second place to fourth place (Figure 3).

    Cost of Living: Variations in the cost of living, which is reflected by the metropolitan area exchange rates, remains similar in 2009 to the 2006 rankings.

    The Top Ten: The lowest costs of living were in (Table 1):

    1. St. Louis, where $0.891 purchased $1.00 in value at the national average.
    2. Kansas City, where $0.903 purchased $1.00 in value at the national average.
    3. Cleveland, where $0.921 purchased $1.00 in value at the national average.
    4. Pittsburgh, where $0.941 purchased $1.00 in value at the national average.
    5. Cincinnati, where $0.944 purchased $1.00 in value at the national average.

    Rounding out the most affordable 10 are two metropolitan areas in the South (Atlanta and Dallas-Fort Worth), two in the Midwest (Detroit and Milwaukee) and one in the West (Denver). No Northeastern metropolitan area was ranked in the top 10.

    Table 1
    Estimated Cost of Living: 2009
    Metropolitan Areas over 1,000,000 with Local CPIs
    Rank Metropolitan Area
    Metropolitan Exchange Rate: to Purchase $1.00 at National Average
    Compared to Lowest Cost of Living
    1
    		 St. Louis, MO-IL
    $0.891
    0%
    2
    		 Kansas City, MO-KS
    $0.903
    1%
    3
    		 Cleveland, OH
    $0.921
    3%
    4
    		 Pittsburgh. PA
    $0.941
    6%
    5
    		 Cincinnati, OH-KY-IN
    $0.944
    6%
    6
    		 Atlanta. GA
    $0.958
    8%
    7
    		 Detroit. MI
    $0.959
    8%
    8
    		 Milwaukee. WI
    $0.959
    8%
    9
    		 Dallas-Fort Worth, TX
    $0.976
    10%
    10
    		 Denver, CO
    $0.996
    12%
    11
    		 Minneapolis-St. Paul, MN-WI
    $1.000
    12%
    12
    		 Houston, TX
    $1.000
    12%
    13
    		 Tampa-St. Petersburg, FL
    $1.006
    13%
    14
    		 Phoenix, AZ
    $1.011
    14%
    15
    		 Portland, OR-WA
    $1.034
    16%
    16
    		 Chicago, IL-IN-WI
    $1.041
    17%
    17
    		 Philadelphia, PA-NJ-DE-MD
    $1.054
    18%
    18
    		 Baltimore, MD
    $1.068
    20%
    19
    		 Riverside-San Bernardino, CA
    $1.078
    21%
    20
    		 Miami-West Palm Beach, FL
    $1.085
    22%
    21
    		 Seattle, WA
    $1.120
    26%
    22
    		 San Diego, CA
    $1.151
    29%
    23
    		 Boston, MA
    $1.175
    32%
    24
    		 Washington, DC-VA-MD-WV
    $1.181
    33%
    25
    		 Los Angeles, CA
    $1.222
    37%
    26
    		 San Francisco-Oakland, CA
    $1.258
    41%
    27
    		 New York, NY-NJ-PA
    $1.281
    44%
    28
    		 San Jose, CA
    $1.343
    51%
    Estimated from BEA 2006 data, adjusted by local Consumer Price Index for 2006-2009

     

    The Bottom Ten: The most expensive metropolitan areas were:

    28. San Jose, where $1.343 purchased $1.00 in value at the national average.
    27. New York, where $1.281 purchased $1.00 in value at the national average.
    26. San Francisco, where $1.268 purchased $1.00 in value at the national average.
    25. Los Angeles, where $1.222 purchased $1.00 in value at the national average.
    24. Washington, where $1.181 purchased $1.00 in value at the national average.

    The bottom ten also included three metropolitan areas in the West (Riverside-San Bernardino, San Diego and Seattle), one in the Northeast (Boston) and one in the South (Miami). There were no Midwestern metropolitan areas in the bottom 10.

    Per Capita Income: Per capita income in 2009 was then adjusted for the cost of living.

    Top Ten:Washington has the highest per capita income, adjusted for the cost of living, at $47,800. San Francisco placed second at $47,500. Denver ranked third at $46,200, while the cost-of-living adjusted income in Minneapolis-St. Paul was $45,800 and $45,700 in Boston. The top 10 also included two Midwestern metropolitan areas (St. Louis and Kansas City), two from the Northeast (Baltimore and Pittsburgh) and one from the West (Seattle).

    Bottom Ten: The least affluent metropolitan area was Riverside-San Bernardino, with a per capita income of $27,800. Phoenix was second least affluent at $33,900 while Los Angeles was third least affluent at $35,000. The fourth least affluent metropolitan area was Tampa-St. Petersburg at $36,600 and the fifth least affluent metropolitan area was Portland at $37,400. The bottom 10 also included two metropolitan areas from the South (Atlanta and Miami), two from the Midwest (Cincinnati and Detroit) and one from the West (San Diego).

    The cost of living adjusted income data includes surprises. New York, commonly considered a particularly affluent metropolitan area, ranked 17th in cost-of-living adjusted income, and below such seemingly unlikely metropolitan areas as Pittsburgh, Kansas City, Cleveland, St. Louis and Milwaukee. These metropolitan areas also ranked above San Jose, which ranked first in unadjusted income in 2000, but now ranks 16th in cost of living adjusted income (Table 2).

    Table 2
    Personal Income Per Capita Adjusted for  the Cost of Liviing
    Metropolitan Areas over 1,000,000 with Local CPIs
    Rank (Cost of Living Adjusted)
    Rank (Unadjusted Income)
    		 Metropolitan Area
    Per Capita Income 2009: Adjusted for Cost of Living
    Per Capita Income 2009: Unadjusted
    1
    2
    		 Washington, DC-VA-MD-WV
    $47,780
    $56,442
    2
    1
    		 San Francisco-Oakland, CA
    $47,462
    $59,696
    3
    8
    		 Denver, CO
    $46,172
    $45,982
    4
    9
    		 Minneapolis-St. Paul, MN-WI
    $45,772
    $45,750
    5
    4
    		 Boston, MA
    $45,707
    $53,713
    6
    18
    		 St. Louis, MO-IL
    $45,288
    $40,342
    7
    7
    		 Baltimore, MD
    $44,908
    $47,962
    8
    15
    		 Pittsburgh. PA
    $44,848
    $42,216
    9
    19
    		 Kansas City, MO-KS
    $43,862
    $39,619
    10
    6
    		 Seattle, WA
    $43,730
    $48,976
    11
    13
    		 Houston, TX
    $43,581
    $43,568
    12
    16
    		 Milwaukee. WI
    $43,477
    $41,696
    13
    11
    		 Philadelphia, PA-NJ-DE-MD
    $43,247
    $45,565
    14
    21
    		 Cleveland, OH
    $42,734
    $39,348
    15
    12
    		 Chicago, IL-IN-WI
    $41,990
    $43,727
    16
    3
    		 San Jose, CA
    $41,255
    $55,404
    17
    5
    		 New York, NY-NJ-PA
    $40,893
    $52,375
    18
    20
    		 Dallas-Fort Worth, TX
    $40,494
    $39,514
    19
    23
    		 Cincinnati, OH-KY-IN
    $40,437
    $38,168
    20
    10
    		 San Diego, CA
    $39,647
    $45,630
    21
    24
    		 Detroit. MI
    $39,147
    $37,541
    22
    17
    		 Miami-West Palm Beach, FL
    $38,124
    $41,352
    23
    26
    		 Atlanta. GA
    $38,081
    $36,482
    24
    22
    		 Portland, OR-WA
    $37,446
    $38,728
    25
    25
    		 Tampa-St. Petersburg, FL
    $36,561
    $36,780
    26
    14
    		 Los Angeles, CA
    $35,045
    $42,818
    27
    27
    		 Phoenix, AZ
    $33,897
    $34,282
    28
    28
    		 Riverside-San Bernardino, CA
    $27,767
    $29,930
    Estimated from BEA 2009 income data and 2006 regional price parity data, adjusted by local Consumer Price Index for 2006-2009

     

    Some expensive metropolitan areas such as Washington, San Francisco and Boston ranked at or near the top, but their cost-of-living adjusted incomes were considerably less than the unadjusted incomes. On average, it took $1.20 to purchase $1.00 of value at national rates in these three metropolitan areas. Washington’s unadjusted per capita income was 40 percent ($16,100) higher than that of St. Louis, however when the cost of living is factored in, Washington’s advantage drops to 6 percent ($2,500).

    Caveats: The analysis above does not consider cost-of-living differentials within metropolitan areas. For example, data from the ACCRA cost of living index indicates generally higher prices in the cores of the largest metropolitan areas, such as New York (especially Manhattan), Chicago and San Francisco. Further, these data make no adjustment for relative levels of taxation. A cost of living analysis using disposable income would produce different results, dropping higher taxed metropolitan areas to lower rankings and raising lower taxed metropolitan areas higher.

    Cost of Living Differences: Will They Continue? The spread in cost-of-living between metropolitan areas have been driven wider over the last decade by the relative escalation of house prices in some metropolitan areas in the West, Florida and the Northeast. Whether these shifts in cost of living will be reflected in migration patterns will be one of the things to look for in the new Census.

    ———

    Note 1: Purchasing power parity data is published by the World Bank, the International Monetary Fund (IMF) and the Organization for Economic Cooperation and Development (OECD).

    Note 2: The BEA research applied regional price parity factors only to employee compensation and excluded other income. It is possible that, had the analysis been expanded to these other forms of income, the differences in cost of living would have been greater.

    Photo: Rosslyn, VA business district, Washington (by author)

    Wendell Cox is a Visiting Professor, Conservatoire National des Arts et Metiers, Paris and the author of “War on the Dream: How Anti-Sprawl Policy Threatens the Quality of Life”

  • Time to Hate Those HOAs (again).

    The foreclosure crisis has been devastating for millions of Americans, but it has also impacted many still working as before and holding on to their homes. Even a couple of empty dwellings on a street can very quickly deteriorate and become a negative presence in the neighborhood, at the least driving down prices further, sometimes attracting crime. Untended pools can allow pests to breed. Many animals have been abandoned and shelters report overflowing traffic. The resulting impacts on local governments have been particularly visible, as property tax assessments have fallen and revenues have also gone south.

    Less obvious is the impacts on home owner associations [HOAs], whose revenues have also taken a hit, albeit for rather different reasons. For the most part, HOA dues are not a function of the value of the home but rather the need to cover the costs of maintaining the common interests of the association: landscaping, security and so forth. These tend to be fixed, even if the values of the homes collapse, and may even rise if dwellings are empty and untended.

    Many HOAs, especially in the newer metropolitan areas like Phoenix and Las Vegas where foreclosures have been most concentrated, have taken a beating because the number of households paying into the association has been depleted, quite badly in some instances. The problem seems, from press reports, to cover the economic spectrum. Low-income first-time buyers may stop paying their dues as an economy measure, while more affluent owners are more likely to have pulled cash from their home and are walking away from their debts. There are also thousands of empty homes that were purchased as investments at the height of the boom and may have never even been occupied.

    The foreclosure debacle is now old news, but the HOA situation is receiving attention because association boards are now aggressively trying to recoup their debts, even from those who have walked away from their mortgages. The debt, they argue, is attached to the individual, not to the dwelling, and is being turned over to collection agencies. Now, this is hardly a novelty. Municipalities have been turning household utility debts over to third parties for years, often with some success, and without a murmur of protest. So why is it different if HOAs do it?

    The answer is that HOAs are extremely unpopular with two vocal constituencies. The first is the academic community, and its hostility is part of the professional opprobrium that is heaped on gated communities, privatization and pretty much anything connected with suburban development. Interestingly, while the design aspects of gated communities have caught the attention of planners and urbanists, relatively few have focused on the dimension of governance. Those that have written on the topic have tended to be critical of private clubs that are seen to exist at the expense of the municipal collective. For what its worth, I don’t think I’ve ever known of an academic colleague who lived in an HOA, in contrast to the bulk of my students, who live in one or grew up there.

    The second constituency is more rowdy. Academics just disdain HOAs, but this group is committed to exposing them as a vast conspiracy to subvert the American way of life. This may sound like another version of contemporary “Teamania” but it is has been around for at least the past decade, during which time I’ve been monitoring Internet posts and the like. To this group, any restriction on personal freedom — from the color of one’s drapes or exterior paintwork through the display of the national flag — is clearly anathema.

    Early this year, my research on neighborliness in HOAs was covered in the local paper, and by the end of the day there were dozens of online posts. In response to the basic finding — that there is little fundamental difference between HOA and traditional neighborhoods — we received a torrent of angry responses. With a single exception, they all dismissed the findings out of hand, using an example of someone’s experience (rarely their own) to prove the point, at least to their satisfaction. One reader even tracked down my email address in order to demand an assurance that no public funds were used to promote this nonsense.

    Like much in contemporary American politics, this leaves me confused. I don’t understand why an exclusive residential association, freely entered into, with explicit rules that are presented at the outset, offering services-for-cash, is un-American. After all, this is in contrast to a municipality that levies taxes for services from which one cannot opt out (if one has no children in the schools, for instance) and which may not be available to all (such as public transport), and which could easily be seen as a redistributive institution, an example of that socialism we keep hearing so much about.

    For the record, I am happy to pay my property taxes for services I don’t receive — its just part of the social contract. Nor do I live in an HOA. But I can understand why our research indicates that most people who live in them do prefer them (and, for example, often move from one HOA to another). Rather than displaying the angst of those who seem to get nervous if anyone tries to step on their toes, these residents embrace belonging to a small polity in which they have a voice. And we should remember that rules, like fences, make good neighbors. As these neighborhoods become more diverse, traditional and non-traditional households alike can find reassurance in the behavioral conformity demanded of neighbors by an HOA.

    This brings us back to the recent stories about management boards ‘hounding’ those who have not paid their dues. Similar accounts have shown up for years, and the thrust is always the same: punitive, out-of-control boards attack those already in financial distress. There is clearly a lot of the latter to go round, but it’s hard to see why HOAs are much different than any other organization that is looking at a handful of bad debts. Are the HOAs the victims here? Absolutely not. Many embraced the housing bubble, and permitted speculators to buy in, even though they had no intention of living in the properties. At the height of the madness, up to one third of all housing transactions in Phoenix were initiated by out-of-state buyers who drove up home prices precipitately, and eventually caused the median house price to double. This has since corrected. All CC&Rs (the rules of the HOA) that I have seen dictate however that the purchaser must live in the property and that rental units are not permissible. So, like all the other players, the HOA boards liked the price increases so much that they ignored their own rules and looked the other way, a lapse for which they are now paying the price.

    Still, it would be a mistake compounding a mistake to climb on the anti-HOA bandwagon, now joined by the ACLU, which has recently joined the fray over a fight about a homeowner’s right to fly the Gadsden flag (motto: “Don’t step on me”). Libertarians should recognize that no-one has ever been forced to live in an association and that whipping up the wrath of state legislatures to control HOAs is a bad idea: it encourages even more government intervention, and it messes with the neighborhood, a form of governance that the vast majority rightly supports, even in HOAs.

    Andrew Kirby has written about HOAs on several occasions, including the 2003 edited volume “Spaces of Hate”. He most recently wrote about ‘The Suburban Question’ on this site in February.

    Photo by monkiemag