Since the start of the housing crisis, urbanists and pop sociologists have projected a tectonic shift in the way people live, with several high-profile newspaper and magazine articles predicting that suburban families will resettle in dense urban centers.
In a new article posted on NewGeography.com titled The American Suburb is Bouncing Back, editor Joel Kotkin argues that suburban markets – particularly in the Sun Belt – are showing signs of life, while prices are still falling and foreclosures are piling up on urban condominiums.
The “gospel of urbanism” may be accepted as such by most of the mainstream press, most notably The New York Times and Atlantic Monthly, but on closer examination the new religion has limited numbers of converts. In many locales – from Massachusetts to Los Angeles – inner-city condominium projects are losing value at least as much or more than suburban single-family houses. In San Diego, for example, condo prices have dropped in some developments by 70% since 2007, twice the decline in the overall market.
The problem has much to do with timing. In many areas, urban condominium developers continued to build even as the economy soured, largely due to the longer lead times and financing arrangements around such projects. Yet as the prices of houses have dropped many potential condominium dwellers have opted to purchase single-family homes – or are sitting anxiously on the sidelines waiting for prices to drop further.
But what about the advantages of city living, like “walkability” and short commute times? Good schools and jobs are located outside of city centers, and Kotkin says that American preference for suburban living largely reflects that.
The main reason is simple enough for almost anyone but a planning professor, architect or pundit to comprehend: preference. Virtually every survey reveals that the vast majority of Americans – and around 80% of Californians – prefer single-family homes that generally are affordable only in suburban areas. The fact that jobs have also continued to move inexorably to the periphery – as a newly released bookings (sic) report demonstrates to liberal think tanks’ own undisguised horror – makes living in the ‘burbs even more attractive.
“Virtually every survey reveals that the vast majority of Americans – and around 80% of Californians – prefer single-family homes that generally are affordable only in suburban areas.”
Ah, the old tried-and-true “no one wants to live in the city because it is too expensive” argument. Makes about as much sense now as it always did. This also explains why property values in most (not all) cities have held up MUCH better than property values in the corresponding suburbs.
The fact remains that single family homes in safe neighborhoods in cities are both extraordinarily popular and relatively scarce. That is why they cost so much that they generally cannot be afforded by the average person. It’s not that most people would prefer to commute 50 minutes every day (vs. 15) — it’s that they can’t afford what they would prefer.
Kotkin has been pushing these _exact_ same arguments for years. Unfortunately, he has very few statistics on his side and must resort to silly name calling like the “gospel of urbanism.” Snide comments do not make for sound arguments.
Reading his column, I’m struck by several very important omissions. First, there seems to be no mention of price trends pre-downturn. One of the defining aspects of this downturn seems to be: what went up, came back down. Cities that had large increases in price pre-downturn seem to be suffering more in the downturn. This NYTimes graphic of the Case-Schiller numbers demonstrates this effect well:
So I ask Kotkin: the cities may be crashing harder during the bust, but did they also gain much more value during the boom? And how did rural and suburban prices fare during the boom? My guess is that those prices have been much more stable than city prices. Is it any wonder that city prices have further to fall.
The second thing that strikes me is how Kotkin is looking for large demographic shifts during this downturn. Really? I would expect that if this downturn had a long term impact on demographics in this country, those changes would only be observable in the long term.
For instance, look at the loss of manufacturing and its impact on Chicagoland demographics. Those losses took decades to play out. Similarly, we are seeing shifts in demographics in Chicagoland today with more immigrants settling in the suburbs, revitalization of the urban core and the demographic shifts that accompany such changes. While we have seen hints of what these shifts mean through 5-year census estimates, it will probably be another 2-3 official censuses before clear trends have established themselves.
All of this to say: this is an extremely complex issue that deserves mountains of reliable data thrown at it. Kotkin, true to form, has an obvious agenda and a seeming disregard for the facts. If you are really interested in reading up on demographic trends in the US, there are _much_ better places to get your information from.
Kotkin is also preaching a false dichotomy between urbanism and “suburbanism.” Urbanism also exists in many suburbs. There are plenty of examples of walkable, mixed-use downtowns with Metra stops in the Chicago suburbs that would be included in the “gospel of urbanism.” Urbanism is a human settlement pattern that encompasses the full transect from downtown to rural. See http://www.transect.org .
Lee,
Chicago’s history of railroad suburbs has left it, as you note, with many walkable neighborhoods near train stops. You’ll find them all along the north shore, for example.
I don’t see, however, how you can characterize those neighorhoods as “urban.” Winnetka has urban areas? Highland Park and Lake Forest have urban areas?
Apart from Evanston I can’t think of a single Chicago suburb that has a truly urban, i.e. dense and richly varied, environment.
TftInChi,
You haven’t addressed Kotkin’s larger point: that the great majority of Americans continue to be more attracted to suburban than to urban living.
Spoken like guys who don’t have kids or kids in school. The recent economic impact has given serious thought for many in city to reevaluate if all the negative factors (crime, graft, poor schools forcing some to private school) is worth it. Don’t underestimating the smart ones that are re-evaluating having enough means to survive a period like this again. Familes are evaluating why pay over $10k per year per child for private school when equal or better schools exist for free
in the Suburb. Take a look at the impact to Suburban private schools taking huge hits, and some closing.
If the economy shows signs of improving and housing values stabilize, you will see some movement back to the suburbs or the mini-urban locations (Evanston, LaGrange, Oak Park, Naperville). The key to this though, imo, will be the balance between job stability, home value recovery, and deciding whether the low interest rate value will be wiped out by inflation or sluggish home values.
Places like Evanston, Lagrange, Oak Park, and Naperville I think offer the best options in the long run in these regards with access to downtown (at least the first 3), schools, value (temporary), local urban type ammenaties, and an optional local job market.
On top of this, Chicago has provided some good capital gains for the last 10 years, getting more people to use the primary residence as a bigger investment vehicle than it should be (right or wrong). People I talk to talk of cashing it in, and then focus on recovering in the other investment areas. Then, what ever the house provides after 20 years, gravy.
Jeff,
Tuition and fees at Latin, Parker and the U of C Lab School add up to well over $20k a year – and that’s only part of the expense.
Add in the fact that a single family home in a decent area in Chicago costs far more than it does in even the most desirable of Chicago suburbs and the economics become compelling for the majority of families.
“But what about the advantages…short commute times?”
About a year or two ago the Trib ran an article regarding commute times of people who lived in the city as opposed to various suburbs. There was little difference. I’ve lived in the burbs all my life and for the 20 years of my working life I’ve had a commute of over 20 minutes for only four of those years. I currently have a 2.5 mile commute that takes me about 6 minutes, 9 if I stop for coffee.
Discussions of urban vs. suburban tend to get polarized (and anecdotal) pretty quickly. Over the last 10-15 years the decline of urban areas has ended and we’ve been seeing a revitalization of many neighborhoods. This does not mean that everyone is abandoning the suburbs, but many more people are seeing the city as a viable place to live with a family.
“Add in the fact that a single family home in a decent area in Chicago costs far more than it does in even the most desirable of Chicago suburbs”
This is definitely not true – there are plenty of decent neighborhoods in the city that cost less than the most desirable suburbs – i.e. Winnetka, Bannockburn, Kenilworth, Highland Park, Wilmette, Northfield, Mettawa, Burr Ridge, etc….
There are also plenty of education options available for less than 20K. For example, Gordon Tech is $8-9,000. There are also plenty of Magnet and open enrollment schools that are on par with most suburban schools.
I don’t think this means the suburbs are dying or the city is the best choice for everyone, but it is a viable option for families today in a way that it wasn’t in the 70’s and 80’s.
“Add in the fact that a single family home in a decent area in Chicago costs far more than it does in even the most desirable of Chicago suburbs and the economics become compelling for the majority of families.”
I guess this is what I don’t understand. If the average “decent city house” in Chicago costs more than the average suburb house, doesn’t this pretty conclusively prove that urban living is more desirable? Or put a little differently, why on earth would anyone pay more to live in the less-desirable city?
I guess I revert back to my original point. I think that given a decent single family home in a safe neighborhood in the city vs. the suburbs, most people would prefer the city. They just can’t afford it (and “it” includes private school tuition, parking, etc.).
Joe Z: You are right that I didn’t address his point that the majority of Americans want to live in the suburbs/country. I didn’t address it, because I’m not sure it is relevant to the discussion. As Kotkin himself notes, Americans have preferred rural/suburban living to city living pretty much since we began polling them on the matter. This is not a new phenomenon and long term demographic shifts have shown this preference plays out (migration to the sun belt, to the suburbs, etc). On that point, Kotkin will get little argument from me.
But that really isn’t the point Kotkin is making in his article. Rather, that data is the backdrop Kotkin uses for many of his arguments. In this particular column, the argument can be summed up as: the suburbs are back during the bust (he titled the column well, I guess). His point revolved around the fact that people have said urban living is back yet the cities are being hit harder by the downturn than the suburbs.
Problem is: he didn’t show that.
Instead, he makes huge logical leaps. For instance, he says that the suburbs were hit hard early on in the boom and urbanists gloated about it. Then he says that cities are getting hit hard now (actually he said “unravelling”). Both statements are true. But what Kotkin is trying to show is that somehow the cities are worse off, that the suburbs are recovering while the cities are unravelling. The scant data Kotkin cites in his piece simply does not support that conclusion.
I have read a lot of Kotkin’s work and I have a certain amount of respect for the guy, sticking to his position for as long as he has as fads have come and gone. And as I said above, in terms of sheer preference of the American people, he is right. But he has also consistently downplayed the urban renewal that most American cities have experienced in the last 2-3 decades and any data showing vitality and life in the cities. He has also minimized the extent to which cities fuel the economies of the larger metropolitan areas.
As I said earlier, if you are looking for hard data and unbiased, scientific analysis of that data, Kotkin is not your go-to man. He has a very obvious agenda and his writings on trends and data are notoriously sloppy.
The Brookings Institute released a study yesterday showing job decentralization from 1998-2006 in almost all metro areas and their write up on the data is excellent: very scientific and informed, especially for a “liberal” institution such as Brookings reporting on a very un-urban trend. Kotkin should take a page from their book and knock off the silly and unnecessary urbanist bashing and focus on the facts at hand and trends that are actually backed up by comprehensive data. But then he probably couldn’t sell his columns to papers…where’s the drama in that?
“I guess this is what I don’t understand. If the average “decent city house” in Chicago costs more than the average suburb house, doesn’t this pretty conclusively prove that urban living is more desirable? Or put a little differently, why on earth would anyone pay more to live in the less-desirable city?
I guess I revert back to my original point. I think that given a decent single family home in a safe neighborhood in the city vs. the suburbs, most people would prefer the city. They just can’t afford it (and “it” includes private school tuition, parking, etc.).”
I think we probably both agree on what is great about living in a city, and disagree with Kotkin’s gross assumptions and exaggerations.
I think the increase in the price of homes in the city indicates that the demand for urban living is higher than it has been in decades, but I don’t think that means “most people would prefer the city”, or that financial considerations are what is keeping people out of the city. If this was the case many people in the North Shore would be moving into the city to save some money. I think suburban growth has peaked, but suburban living is still preferred by most people (certainly not by me tho’).
TftInChi,
Kotkin referred to the Brookings report on jobs in his article. He originally misspelled Brookings (per our quote above) and has since corrected it.
I’ve also read a fair amount of Kotkin over time. His style of argument is more conclusory than you clearly prefer, but that doesn’t make him wrong.
Price levels in the more desirable areas of central cities have generally been more volatile than in suburban areas for a variety of easons, and may have been even more so lately. The speculative / investment component of a home purchase is more of a factor among city purchasers in these areas, while suburbanites focus more on the shelter / lifestyle component since their time horizon on ownership and the reasons for their locational choices are often very different.
Attrill,
I think the best answer to your point is a recent study )sorry I can’t recall the exact reference) to the effect that most urban dwellers would prefer to be living somewhere else and very few non-urban dwellers want to move to the city.
The higher price levels in desirable areas of the city simply reflect supply / demand imbalances due in large part to the fact that so few areas of the city are perceived as desirable to a broad range of people.
I have no doubt most urban dwellers would prefer to live somewhere else. However, if you look at the urban residents living in desirable neighborhoods I suspect the opposite would be true. That’s a relatively exclusive and self selected group who largely have a choice whether to live in the city or a suburb. They chose the city.
Someone living in a downtrodden gang infested neighborhood would more likely be interested in moving. Don’t ignore the attraction of the suburbs to someone from such a neighborhood or even someone who grew up in a stable neighborhood with smaller homes and lots. Like the dark side of the force the suburbs can be very attractive. Seriously, with 8-9 million people living in greater Chicago it’s not realistic to expect most people to live within the city limits. I’m no fan of suburbia, but it does fill a need for many people and many suburbs are great places to live.
If you look at the City of Chicago realistically there aren’t that many desirable neighborhoods to raise a family. Let’s assume you want an 1800+ square foot house or townhouse and want to keep the price at a reasonable 1.2 million dollars or less. What desirable neighborhoods would offer that?
Parts of Lincoln Park and Lakeview. All of Beverly, North Center, Greater Ravenswood, Sauganash, and some areas on the far NW side. That’s about it.
There are certainly other decent neighborhoods where you can find homes well below that maximum price, but I don’t picture Avondale, Mayfair, Chatham, Uptown, Bucktown etc appealing to the great mass of suburban dwellers. That 2-3 car front loading garage and sub basement with jacuzzi and bar is attractive to many people.
I read a great article espousing school vouchers as a way to rebuild the cities and inner ring suburbs. I can’t find the article, but it would certainly make a difference. It would also cause some other problems. The late military theorist John Boyd was fond of saying every solution creates another problem. If a way was found to make central cities more attractive places to live you would likely find depopulation and higher crimes rates in outer suburbs.
I think the suburbs largely appeal to people for three reasons: schools, space, and a lower crime rate. There are obviously more reasons than that. Some of which involve jobs, bigotry or simply a desire for a quieter lifestyle.
I prefer city living. I like not owning a car and being able to walk places. I don’t find it strange to bike 20+ miles from Uptown to a family event on the SW side. However, when I get there I am viewed as some strange creature by my younger relatives who are used to driving or being driven everywhere. Of course I am strange, but not because of the biking.
Clearly over the last twenty years there has been a national trend of people moving into central city areas. Simultaneously the outer reaches of cities are becoming less populated and suburbs are also growing. One phenomena does not exclude the other.
Chicago is perhaps the best example. The downtown and north lakefront neighborhoods and areas immediately to the west have become more expensive and desirable, but massive areas of the south and west sides are losing population and building stock. The loss of population in those areas may be more than the possible gain of population in other areas such as the South and West Loop.
Oh well. Time for a drink.