Harvard economist Edward Glaeser has joined the Antiplanner’s effort to rehabilitate Houston in the public mind. Writing in the New York Sun, Glaeser notes that the Houston metro area is growing 7 times faster than the New York metro area, mainly because Houston is far more affordable.
“Consider an average American family,” says Glaeser, “with aspirations to a middle-class lifestyle. What kind of life will such people lead in Houston and New York City?” He answers that they will earn perhaps 15 percent less in Houston. But New York housing, even on Staten Island, costs twice as much as in Houston for a lower-quality product. Taxes are also lower in Texas.
But isn’t auto-dependent transportation much more expensive in Houston? Glaeser guesses a family relying on public transit in New York (and such a family would probably have to live in more expensive housing than can be found on Staten Island) might save $3,000 a year on transportation. But, he adds, that transportation is of lower quality: the average New York commuter takes 42 minutes to get to to work, while the average Houston commuter takes only 27. Even higher fuel prices, says Glaeser, won’t “come close to evening the playing field.”
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Most other prices are also higher in the New York area. After deducting housing and transportation from local price indices, the remainder — mainly food, utilities, and health — is 24 percent more expensive than the national average in Queens and 6 percent less expensive in Houston.
“The Houston family is effectively 53 percent richer,” says Glaeser. He blames the difference on the different costs of development. Rent control and an onerous permitting process make it difficult to supply housing in New York. Houston has no such problems.
“Houston’s success shows that a relatively deregulated free-market city, with a powerful urban growth machine, can do a much better job of taking care of middle-income Americans than the more ‘progressive’ big governments of the Northeast and the West Coast,” concludes Glaeser. (I am glad he got that that dig in on “progressive.”) The right response is not to stymie Houston’s growth through regulation but to deregulate housing markets elsewhere “and start beating the Sunbelt at its own game.”
Glaeser: “Queens is 24% more expensive than the average American area and Houston is 6% less expensive.â€Â
He also does not mention that much of that difference in the price index is also due to more regulation including, of course, regulations that limit housing supply and make dwellings more expensive.
Glaeser: “For environmentalists who worry about carbon dioxide emissions and global warming, Houston’s rapid growth is particularly worrisome, since Houstonians are among the biggest carbon emitters in the country  all those humid 90-degree days mean a lot of electricity to cool off, and all that driving gobbles plenty of gas.â€Â
At the same time, on the temperate California coast, where little energy for heating and cooling is required, the same “environmental awareness†has formed a coalition with NIMBY protectionism and has been successful at excluding other Americans from moving into their California paradise (although, like most protectionism, it eventually hurts as much, or more, the “protected†as it hurts the outsiders to whom it seeks to limit opportunity).
This article has a lot of good points about New York’s policies that must be reviewed.
However, it begs the question: isn’t this an apples-to-oranges comparison? Houston is a relatively young “boom city” of the USA today – it is where New York was about 150 years ago. It is growing at a fast pace and adding new neighborhoods by the day – this simply cannot happen in New York, not just because of “growth management” and “big government”, but because New York is constrained by geography, distance, and its significantly larger size.
In fact, looking at census history, New York had two decades where its population literally doubled in 10 years… 1850 and 1900. Houston was barely on the map.
There have been very many boom cities in American history – Philadelphia, Pittsburgh, Detroit, Saint Louis, etc. All of them grew rapidly, drew new commerce and new settlers because of their relative affordability, and made the old cities look like sliced bread. I just don’t see how Houston is particularly different, and why people are so perfectly sure that it is the new example for how we should be living. How will Houston be in 150 years when it has 20,000,000 in its metro area?
I don’t think that is relevant, hkelly1. The point is, in the mind of most planners Houston is Public Enemy #1 and New York is heralded as a model. These planners and politicians who share their vision want to retrofit American cities in the New York model, not the Houston one.
Glaeser looks at the two from the viewpoint of the average American citizen and finds more to recommend in Houston, despite its imperfection. If we’re interested in creating cities better suited for regular Joes and Janes, Houston is the place we should look.
Seeing as how the NY-NJ area is built-out and infill on already-expensive land is problematic, it is no wonder that a metropolitan area with few physical barriers to development (not being located on an island and surrounded by mesquite instead of houses) is cheaper to develop. And since Ricardian rents are high, you don’t get manufacturing jobs. They move to the Houstons of the world.
And the other thing Glaeser mentions is that the knowledge jobs in NY area drive up rents. So naturally when Houston decides to diversify and attract more knowledge jobs, rents will go up as the upper middle class will demand costly amenities and equilibrium rents will go up and up.
Maybe – as Glaeser mentions when he writes about Boston – someone can get rid of the single-fam Euclidean zoning at 2-4 DU/ac to get more housing in NY-NJ area. Like down the shore towards Bruce’s old digs.
DS
“And the other thing Glaeser mentions is that the knowledge jobs in NY area drive up rents. So naturally when Houston decides to diversify and attract more knowledge jobs, rents will go up as the upper middle class will demand costly amenities and equilibrium rents will go up and up.”
What constitutes a knowledge job? Who tracks these numbers? My experience in looking for places to move a couple years ago was that places like Dallas and Houston had plenty of very good play software related jobs.
Does it really happen that way? That is, first comes the high priced jobs and then the high priced real estate and cost of living? Or do rising prices over time mean that only very high end types of jobs end up sticking around?
What constitutes a knowledge job?
Non-manuf, non-service. FIRE, hi-tech.
Who tracks these numbers?
DoL, Chambers of Commerce, you name it. Richard Florida.
My experience in looking for places to move a couple years ago was that places like Dallas and Houston had plenty of very good play software related jobs.
Yet you settled for the amenities instead of the cheapest housing. Very common.
But more on point, most cities understand the value of knowledge jobs and have varying degrees of success in attracting them. That’s why cities want to attract them: they are high-paying jobs. Cities want the wages. Cities with more amenities attract more high-paying jobs.
Does it really happen that way? That is, first comes the high priced jobs and then the high priced real estate and cost of living?
Usually. Carruthers, Gyourko for hard micro-, and Florida for softer micro- are the places I’d recommend to get up to speed on this issue. Kahn’s Green Cities writes about it.
Or do rising prices over time mean that only very high end types of jobs end up sticking around?
Unless you’re Vail and Aspen, trying to keep service workers nearby.
DS
Hey with this blog one can expect to get a hot air & turd combo!
â€Â…Cities with more amenities attract more high-paying jobs.â€Â
One of the main amenities is maintaining exclusive limited access to your geographical area by enacting policies that prevent other people from moving in.
There would be no problem with that really if the majority that makes these decisions indeed owned outright the entire greater geographical area that they live in. But they don’t. They simply keep outsiders out by regulation aimed at preventing the local minority of landowners from doing what they want with their property (develop it in this case – resulting in more outsiders moving in).
Actually the model of what is happening in places like, say, California Oregon and Washington is pretty simple:
A local majority (residents) tyrranizes a local minority (landowners) in order to exclude an even larger majority (other Americans) from moving into their area. BTW these other Americans are given no say in the issue
But, as I said before, while protectionism remains a popular idea, in the end, there are more negatives to positives in protectionism, even for the protected.
Houston is 25% bigger than New York but only has a quarter of the population. But since not many New Yorkers live on the water that makes Houston’s land area twice as big as New York’s. But it results in homes being only half as expensive. Who woulda thunk it.
How come somebody writing for the NY Sun didn’t unearth the fact that less than half of NYs households own a car. That makes the average NY families travel costs $5,000 less than Houston. Of course Houston commuters have the advantage of only having to compete for commute space with a handful of county commuters. New York City’s 8 million commuters have to compete with another 8 million commuters living in the Tri-State area.
I would like to know what amenities Houston and Dallas are missing that you can get in other large cities (generally) that make people choose them over Texas cities. Weather/climate I can understand. People generally don’t like heat + humidity in combo. But even then, a lot of people would rather put up with 3-4 months of that than 5-8 months of cold and snow.
T.O.:
I lived in Dallas when the public wanted to lynch Landry for the Cowboys bad ’88 season.
I don’t want to tread on any toes, but let’s just say that the area is missing mountains, non-tepid/turbid water, varied and interesting landscapes, biological diversity, is not lacking fire ants and a bug-of-the-month club, and many other places don’t consider ignorance as a virtue. Oh, and I no longer watch manly trucks sporting chrome side-stacks and Confederate flags 4-wheeling seemingly almost daily up the side of the freeway, spraying gravel and mud on everyone to escape the daily traffic jam, or yelling and/or throwing things at me and my bike to get off the g*dd*mn road. I did meet many charming, fun and interesting women there and will always remember them, and the West End and Deep Ellum, and Lady Bird’s flowers, and the high-end architecture, esp the Chase Tower (and the keyhole at the Equinoxes) and the now-named Fountain Place and the Morning News’ frequent featuring of it.
Diff’rent strokes for diff’rent folks.
DS
Kevyn Miller: “How come somebody writing for the NY Sun didn’t unearth the fact that less than half of NYs households own a car.â€Â
Probably because his comparison and analysis was for people with a middle class standard of living. New York also has a large underclass and my guess is that most of that percentage of NewYorkers who do not own a car belong to the underclass and so probably cannot afford to own and operate even one car. Most likely the cost of simply owning a car in NY (not operating it) is higher than it is in Houston. IMHO, households in NY (or any other city in the world) who do not own even one car have a very low standard of living. Even in high density transit promoting Europe virtually all households with a middle class standard of living have at least one car. Can you just imagine what kind of life living in NY without a car must be? You spend day after day, month after month within the confines of the city blocks of Gotham city.
â€Âthe area [Houston, Dallas] is missing mountains, non-tepid/turbid water, varied and interesting landscapes, biological diversity, is not lacking fire ants and a bug-of-the-month club,
These amenities have nothing to do with government planning. Places that are endowed with such natural amenities can have high demand and still maintain average housing prices so long as they do not choke off development and allow supply to meet demand. But, as I said before, the main aim of housing supply regulation is protectionism. Trying to stem the inflow of people.
Ettinger has obviously never been to NYC or Yurp. Thus his wrong conclusions follow from false premises.
I’ve been to NYC there many times (old GF in Chelsea, upper middle class buyer in Garment District) and there is no need for a car until you want to go to the Shore, upstate, etc. Then you borrow one.
Can you just imagine what kind of life living in NY without a car must be?
No, you having never been there means you wouldn’t know what a hassle a car is, esp on Manhattan. Far suburbs or NJ, sure. The Boroughs? Queens & Staten Is, maybe. Long Is, probably.
And when I lived in Yurp, just as often as not I’d go somewhere without a POV, and rarely would I go solo (gas too expensive and I traveled often); when you got to the city (I lived in a tiny Dorf), you parked & walked or took transit. I rarely went to another country by car, as the train was way cheaper and far, far, far more convenient. I think maybe twice I went skiing by car, and after the second time we all swore we’d never do that again. Never did I take the train to a city & rent a car – why? No need.
The narrow, short time period experience of the Murrican suburb is absolutely not the case for 95% of the other cities in this planet. Travel sometime. Learn how the vast majority of the world works for yourself! It’ll be fun!
DS
Places that are endowed with such natural amenities can have high demand and still maintain average housing prices so long as they do not choke off development and allow supply to meet demand. But, as I said before, the main aim of housing supply regulation is protectionism. Trying to stem the inflow of people.
Right. I’ve said this to and quoted many passages that have said this, my favorite being Glaeser.
Tell the residents of a city, though, that they must give up their quality of life so more people can be there. Go ahead. Go for it. Go on, do it!
Go for it. Tell us how you do. Tell us what brilliant thing you say to change human nature. Tell us by book, as it will be a billion-seller and you’ll be filthy rich.
DS
The Antiplanner has never explained why members of a community are obligated to do whatever necessary to accommodate additional population.
Dan, how many cities do you know of that are completely stagnant culturally, demographically, and economically over a 20-year period? Especially when the metropolitan population gains 2.5 million people in that time period?
Let’s see,
(1) Sure we don’t have mountains and clear rivers, but we’ve got good recreational lakes out the wazoo. There are mountain ranges within 3 hours of Dallas in three different parts of southern Oklahoma and the famed Texas Hill Country is only 150 miles south of us.
(2) DFW is in the cross-timbers and transition zone from the piney woods to the blackland prairie to the great plains, so I have no idea what the biological diversity argument is about.
(3) We have bugs. Ok. (Doesn’t everyone have some form of pest in their parts?)
(4) Ignorance? Arrogance, maybe. I guess ignorance makes a lot of money, then, because Dallas-Fort Worth is flowing with money. We have the largest concentration of billionaires and one of the largest concentrations of corporate headquarters in the world. (P.S. Most people don’t consider being a smart-ass elitist a virtue either).
(5) Oh, and I’ve grown accustomed to seeing luxury cars and SUVs everywhere on newly constructed, attractive urban freeways flanked by overflowing commuter and light rail networks heading into a rapidly expanding downtown and uptown area that has trillions of dollars being invested in it.
You’re right. Different strokes for different folks. Sorry you had such a horrible Dallas experience twenty years ago.
T.O., you asked, I answered. I made no claim to universality.
Many people choose to not live there. In fact, I moved back to Sacto from Dallas, but chose to leave Sacto too after so many people chose to move there (many Texans with the Bay Areans and LA ppl.) that the QOL was shot – too many cars made for such bad air pollution you couldn’t see the Sierra anymore and bike commuting became painful.
D4P:
The Antiplanner has never explained why members of a community are obligated to do whatever necessary to accommodate additional population.
Amen.
And why don’t the new residents have to pay compensation to extant residents for intruding on their QOL rights such that they are irreparably degraded?
DS
The [people on this site have] never explained why members of a community are obligated to do whatever necessary to accommodate additional population.
Looks like they are obligated to pay additional taxes and fees in some areas:
DS
Since when (rhetorical question, at least for certain parts of the country) did planning turn into an effort to prevent or impair growth rather than organize it to make it as functional and livable as possible?
My reaction to the original article:
Duh!
Of course the Northeast is more expensive than other parts of the country, and of course it’s due to too much government interference. This is news to anyone?
Jay — Bristol, CT
libertyalert.blogspot.com
Since when…did planning turn into an effort to prevent or impair growth rather than organize it to make it as functional and livable as possible?
Why is growth inevitable everywhere? is an equally valid question. Or mybe “why is the ‘growth is good’ paradigm obligated to play out everywhere?”
Perhaps you should raise that question in a particular forum, TO. I’ll reply there as well. Anyway,
If the publics of a particular area don’t want growth, that’s their choice. If our profession offers the alternative choices for decision-making and the publics choose no growth, well what then? That’s the nature of human nature. We can’t make them do what they don’t want to do (for whatever reason).
DS
†Go for it. Tell us how you do. Tell us what brilliant thing you say to change human nature. Tell us by book, as it will be a billion-seller and you’ll be filthy rich.
First, the rest of America can become upset at the protectionist policies of the, say, Pacific Coast, which limit inter-US freedom of movement, and pressure states to abandon them, just like they would apply pressure if a state applied protectionist policies against interstate commerce. So why not uphold interstate people mobility. And they could do that NOT by tyrrany but by simply demanding that the local majority uphold the property rights of the suppressed local minority.
Second, the “protected†could finally wake up to the fact that in the end, most protectionism is detrimental to the standard of living of the protected themselves.
But as far as publishing a far reaching book, as I said before, I have no interest in a national awakening regarding the mechanics of real estate inflation. I can see clearly the effects of presumed QOL protectionism in the money I’m making every year in real estate. And since thanks to the, regulation induced, real estate profits I make, I have now become semi-retired at a very young age from my more productive job as a scientist/businessman in cancer research, I am now on my way to becoming a complete parasite who with very little effort profits mostly from people who aspire to move to the West Coast.
So I simply find some schadenfreude entertainment in pointing out what is happening in practice. Since marginal happiness decreases as wealth increases, I value more the entertainment of pointing out the absurdity of the situation, than I am worried about the small possibility that I may loose some profit if a lot of people become more aware of the financial mechanics of current real estate regulation.
P.S. You overestimate the probability and magnitude of profits from book publishing. Real estate investing in a near zero supply market is much more profitable.
â€ÂThe [people on this site have] never explained why members of a community are obligated to do whatever necessary to accommodate additional population
Indeed, perhaps the above statement best represents the root of our discord. My position and observation is that in practice, in most areas, the residents do not actually own the land that belongs to their greater metropolitan area. They simply own a small proportion of it (the sum of the lots where their houses sit on) but use their local majoritarian power to take away property rights from a minority that owns land surrounding the metropolitan area – in order to achieve their larger protectionist goal of keeping all other Americans out of their area.
majoritarian power
Too bad the small-minority ideology isn’t compelling to the majority, eh?
Or maybe you reeeeally want to live somewhere with minority rule. Myanmar, North Korea, Sudan…
DS
But is the local majority really a majority? At the national level they’re just a minority trying to keep the majority (all Americans) out of their area.
Ah. Folks who live in an area can’t decide their fate. Talk about having no property rights and control to central gummint. Sheesh.
DS
Ettinger, When you said “Probably because his comparison and analysis was for people with a middle class standard of living. New York also has a large…” I though the next word had to be upper class. I thought Manhattan was rather wealthy which would explain why one one in four people living their don’t own cars. When they need a car they can afford to hail a cab or rent a limo or a helicopter. Since Manhattan only has 25% car ownership it would appear that the outer areas of Queens and Brooklyn must have more than 60% car ownership to arrive at 48% for New York City. Perhaps it is only the middle classes who can’t afford not to own a car.