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Category Archives: Housing

Closing the Black-White Homeownership Gap

By | | Housing, Useful Data
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Homeownership rates in the United States peaked in 2004 at a little over 69 percent, then declined after the financial crash to less than 63 percent in 2016. Since then they have risen slightly to above 64 percent in late 2017 and 2018.

When broken down by the race of the householder, non-Hispanic white rates have been 6 to 8 percentage points higher than the national average, while black rates have been 20 to 22 percentage points lower. Between 1995 and 2004, blacks closed some of the gap, going from under 60 percent to more than 65 percent of the rates enjoyed by non-Hispanic whites. After the financial crash, however, blacks lost more than they had gained in the previous decade, with rates falling below 58 percent of non-Hispanic white rates in 2016.

Black rates made a slight recovery in 2017, according to the American Community Survey. Table B25003 shows homeownership rates, B25003B has rates for black householders, and B25003H has rates for non-Hispanic whites. There are also tables for whites including Hispanic (B25003A); Indian/Native Alaskan (C); Asians (D); and Native Hawaiian/Pacific Islander (E). But I’m focusing on blacks and non-Hispanic whites as economic bellwethers. Continue reading →

Housing Affordability in 2017

By | | Housing, Useful Data
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Despite all of the weeping and wailing and declarations of housing crises, housing affordability reported by the 2017 American Community Survey did not change significantly from the 2016 survey. However, it is important to keep in mind that the financial data reported in each survey is from the previous year, so data reported in September 2018 from the 2017 survey is actually for 2016.

The most common measure of housing affordability is the ratio of median home prices with median family (or median household) incomes. (Family incomes are a little higher than household incomes, and since families, not households — including unrelated people who live together — tend to be homebuyers, the Antiplanner uses family incomes.) A value-to-income ratio below 3 is affordable; 3 to 5 is marginal; above 5 is unaffordable. Table B19113 of the American Community Survey reports median family incomes; table B25077 reports median home values.

The Antiplanner has posted a file showing median home values and median family incomes reported by both the 2016 and 2017 surveys (meaning the data are for 2015 and 2016) for the nation, states, and major counties, cities, and urban areas. Data reported for counties, cities, or urban areas in 2016 but not 2017 are excluded; data reported in 2017 but not 2016 are included with zeroes in the 2016 columns. Continue reading →

Maui Housing

By | | Housing
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The Antiplanner is in Maui today talking to the Grassroot Institute about housing costs. The Institute may also release a new report on this subject, and if so I’ll update this post or post a link to it tomorrow.

According to Zillow, the median home in Maui costs $519 a square foot (download the file called “Median Home Value Per Square Foot” for Metro & U.S. under “Home Values”). Honolulu is $545. A few metro areas in California are the only ones in the United States that are more expensive.

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California Bill Threatens Neighborhoods

By | | Housing
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Speaking of the San Francisco Bay Area, as the Antiplanner was doing yesterday, the California legislature may be on the verge of passing a bill that will make that crowded region even more congested. Assembly Bill 2923 would allow, even require, that the Bay Area Rapid Transit Authority to overrule local zoning and impose high-density housing on neighborhoods within a half-mile of BART stations.

Not surprisingly, many cities including Fremont, Hayward, Lafayette, and Pleasant Hill oppose this preemption of their local authority. More surprising is opposition from the California chapter of the American Planning Association. While the APA supports minimum-density zoning, it doesn’t believe that transit agencies should be allowed to preempt local cities. Apparently, more APA members work for cities than for BART.

The bill’s advocates argue that high-density housing will be more affordable, a myth the Antiplanner has addressed before. Mid-rise construction costs 50 percent more and high-rise costs 68 percent more per square foot than low-rise housing. Land in areas with urban growth boundaries can be hundreds of times more expensive per acre than areas without boundaries, so densities would have to be that many times greater to get land costs per unit of housing down to reasonable levels. Continue reading →

Let’s Be as Dense as Hong Kong

By | | Housing, Regional planning
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Vox‘s Johnny Harris looks at housing in Hong Kong, noting that it is rated the least-affordable housing market in the world. (At least the English-speaking world, China, Japan, and Singapore, which are the housing markets reviewed in Wendell Cox’s 14th International Housing Affordability Survey). Harris shows living conditions roughly similar to the 1890 tenements of New York City documented by Jacob Riis in How the Other Half Lives.

Harris reveals that housing prices aren’t high because Hong Kong has run out of land. Instead, he notes, “Flying over Hong Kong, you start to see that, while yes, there’s a very dense urban landscape, but there’s also a whole lot of green space. Government land-use data says that 75 percent of the land in Hong Kong is not developed.” Continue reading →

Tracking Housing Affordability

By | | Housing, Useful Data
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Zillow reports that “home values grew the most in markets with the strictest land-use regulations.” That’s not exactly news to Antiplanner readers, but it’s nice to hear others confirm it.

Unfortunately, Zillow bases its measure of who has strict land-use regulations on the Wharton Land-Use Regulation Index. This is the best index available but it still has a few problems. First, it is more than ten years old. Second, it only measures the strictness of city zoning, not the strictness of rural zoning near the cities (i.e., growth management). Third, it doesn’t measure how easy it is to get variances or zone changes.

As an example of the problems, Zillow concludes from the Wharton index that Houston and Dallas have “medium strict” regulations, while the least-strict rules are found in places such as Indianapolis and Kansas City. Of course, Houston has no zoning, though it does regulate heights and setbacks. The unincorporated areas around both Dallas and Houston also have no zoning and don’t regulate anything except development in riparian areas. Continue reading →

Welcome to Buckeye

By | | Housing
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In a master-planned community called Tartesso, homebuilder D.B. Horton is building and selling homes for as little as $82 a square foot. Considering that the city of Portland, which is hardly the nation’s least-affordable housing market, thinks that $651 a square foot is “affordable housing,” how does D.B. Horton manage to build homes for less than one-seventh of that cost?

Tartesso is located in the Phoenix suburb of Buckeye, which is the biggest city in America you’ve probably never heard of: at 392 square miles, it’s has the fifteenth-largest area of any city in America. But many of the bigger ones are more counties than cities; really, only Los Angeles, Houston, San Antonio, Oklahoma City, and Phoenix itself occupy more land. Continue reading →

Self-Fulfilling Prophecy

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Urban planners predicted that Millennials would prefer renting apartments in dense cities over owning homes in low-density suburbs. So they told regional governments to restrict low-density development and promote high-density housing instead. Now, Millennials are 18 percent less likely to own homes than their parents did when their parents were young: in 1990, 45 percent of 25-34-year-olds owned their own homes; by 2015, it was just 37 percent.

Were urban planners correct? No, says a report from the Urban Land Institute. Instead, Millennials just prefer to live in expensive cities, and that has depressed their homeownership rates.

I don’t think the report is quite right. According to the American Community Survey’s table S0101, which breaks down population by age groups, Millennials a little more attracted to large urban areas than others, but the difference isn’t enough to account for an 18 percent decline in homeownership rates. The data show that 13.7 percent of Americans are Millennials (which the Urban Institute defined as ages 25 to 34 in 2015), while Millennials make up 15.1 percent of urban areas of 1 million people or more. That’s a significant difference, but certainly not enough to reduce homeownership by 18 percent by itself. Continue reading →

The Declining Benefits of Density

By | | Housing
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The housing affordability issue has become a debate between those who believe the solution is to impose more density on cities and those who believe the solution is to eliminate urban-growth boundaries and let people live at the densities they prefer. An op-ed in yesterday’s The Hill endorses the latter view.

Cities exist because people benefit from having resources and jobs in close proximity. But the benefits of that close proximity have decline in the past century with increasing transportation and telecommunications speeds. Nevertheless, many density advocates point to Harvard urban economist Edward Glaeser, who argues that face-to-face contacts are always more valuable than audio or video communications and so there continues to be a need for dense cities like New York. This is supposedly especially true in the finance industry, where New York excels.

If that were true, however, then why are so many finance industry jobs moving out of New York? In the 1990s, 30 percent of all jobs in the securities industry were in New York; today it is less than 20 percent. As Joel Kotkin recently noted, most of those jobs are moving to low-density sunbelt cities. Of course, face-to-face communications are still possible in cities even if they have only 3,000 people per square mile instead of the 70,000 found in Manhattan. Continue reading →

$530/Square Foot for Affordable Housing?

By | | Housing
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A lot of federal money for housing is funneled through non-profit organizations, and those non-profits become lobbyists for continued federal funding. Yet it isn’t clear that they actually do much to make housing affordable. This can be seen from a blog post by Roger Valdez, who says he “was a non-profit housing director for about three years.”

His post analyzes an affordable housing development in the Seattle area being planned by a non-profit called the Plymouth Housing Group, whose purpose (according to its 2016 IRS form 990) is to “develop and manage affordable housing for homeless and very low income individuals.”

Valdez notes that, from 2008 through 2017, non-profits produced 5,576 units of housing. Someone miscalculated to be 620 units a year (they divided by nine when in fact there were ten years from 2008 to 2017). Obviously, that’s more like 558 units per year. Continue reading →