Friday, 2 May 2008

Devaluing Suburbs

This from the U.S. Environmental and Energy Study Institute and the Urban Land Institute and reported on NPR. Living in urban centres may not be just fashionable. It is clear that rising fuel prices will make suburban life less tolerable. Some cities, like Portland, Oregon, have people spending 10% of their discretionary income on transportation. Other cities, like Los Angeles require residents to pay on average 35%. Guess where Policy Analyst Jan Mueller says people are likely headed?

For a long time, cheap energy did allow people to make a choice to save money to live in a place that was less expensive further out. It's becoming less competitive from a financial and a time standpoint to live further out. Congress needs to encourage cities to invest more in existing infrastructure and less in new roads and developments. These changes will help reduce global warming and preserve home values in a down market. Houses closer in to cities have appreciated more than homes that require a long commute to urban centers.
Less roads (hear that Niagara Region?) and better downtowns. That is the future. It is also the future of where property values will increase.

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