Next big moonshot for Houston? TX will pass CA and HTX will pass LA, auto vs. transit job access and realism
A few smaller misc items this week:
Texas will surpass California, and both DFW and Houston will pass LA in population over the next 40 years. "The American future seems to be more Lone Star State than a Golden one."
Houston Public Media/NPR asks "What could be the next big moonshot for Houston?" Among the answers, clean energy struck me as the most ambitious and most appropriate for Houston (ideally cost-effective carbon capture!). My own suggestion for a Houston moonshot?METRO could aspire to offer half-hour or less express trip times from every park-and-ride and transit center to every major job center and both airports using a network of MaX Lanes. A high goal but very achievable and it would support Houston's growth for decades to come. More on it here.
New Geography: Auto vs. transit job access ratios for the top 50 metro areas (hat tip to Bill). Essentially comparing how many jobs are accessible by car within 30 mins (the typical commute) vs. by transit. A Houstonian can access 97.3 times (!) as many jobs by car than by transit within the same commute time. Even in NYC with excellent transit a car can still reach 9.7 more jobs than transit in the same time. The conclusion is compelling:
Where for Transit from Here?
With this minimal transit use relative to the auto and especially in view of the huge transit market share losses since the pandemic, it would seem useful to rethink the role of transit.
Transit does well for work trips to the largest downtown niche markets (New York, Chicago, Philadelphia, Boston, Washington, and San Francisco), though pre-pandemic market shares are unlikely to be replicated in the future because of the popularity of hybrid and remote work, lower office occupancy and the likely improvement in virtual meeting technology.
The reality is that transit is not a substitute for the auto and there isn’t enough money to make it one. Professor Jean-Claude Ziv and I found that making the auto a genuine alternative to transit could be prohibitively costly, annually requiring the entire metropolitan area gross domestic product in some cases. This would leave nothing else for anything else.
It would be foolhardy to suggest that transit is an alternative to the auto (despite this having sbeen implied by federal, state, and local policy for decades of decline), In a non-utopian world, no reasonable increase in subsidies could make it so.
It may be best to identify the small areas within metro areas where transit could actually be an alternative to auto. This would be in neighborhoods where automobile ownership is particularly low, which, in most metros are also areas of greater economic need. Investing billions more to coax middle class commuters off the roads seems a daft approach given the realities.
Phoenix has long been a close competitor to Houston for fastest growing metros (closer escape for Californians, lol), but it looks like that's about to come to an end as they run out of readily available water:
"Arizona has determined that there is not enough groundwater for all of the housing construction that has already been approved in the Phoenix area, and will stop developers from building some new subdivisions, a sign of looming trouble in the West and other places where overuse, drought and climate change are straining water supplies.
The decision by state officials very likely means the beginning of the end to the explosive development that has made the Phoenix area the fastest growing metropolitan region in the country. …
The decision means cities and developers must look for alternative sources of water to support future development — for example, by trying to buy access to river water from farmers or Native American tribes, many of whom are facing their own shortages. That rush to buy water is likely to rattle the real estate market in Arizona, making homes more expensive and threatening the relatively low housing costs that had made the region a magnet for people from across the country.
“Housing affordability will be a challenge moving forward,” said Spencer Kamps, vice president of legislative affairs for the Home Builders Association of Central Arizona, an industry group. He noted that even as the state limits home construction, commercial buildings, factories and other kinds of development can continue."
Warren Buffet calls bs on rail, remote work permanence, induced demand idiocy, HTX tech + construction + port growth, Ike Dike, and more
Happy new year everyone! Hope you all had a good holiday season and didn't get caught up in the Southwest airlines chaos. Sadly, I accidentally wiped out all my backlog of post topics and blogspot does not have any recovery functionality (why can't it keep history like Google Docs?!). So I'm combing back through my tweets to try to find at least some of them:
Richard Florida: “When I started with the creative class, places didn’t care about young people, they were only trying to attract a family with children to the lovely suburbs, and I’m saying, ‘No, no, no, no, no,’” Mr. Florida said in an interview. “Twenty years later, people forgot about the families. And now here’s a whole generation leaving cities again, for metropolitan or virtual suburbs.” ...
"A few feet away from her, another group of young workers was playing Jenga. One by one, they took blocks away from the structure, making way for the inevitable collapse."
NYT idiotically parrots the induced demand argument, including mentioning I10 and I45. Which type of infrastructure should government invest in: transit nobody will use, or lanes everybody will use? 🤔 Induced demand is a false argument. Nobody says "don't build a new airport runway - it will just fill up with new flights" 🙄
AP: Warren Buffett jumps into local politics to fight streetcar: "Billionaire investor Warren Buffett broke with his practice of staying out of local politics to urge his hometown of Omaha to abandon its planned streetcar project because he says it's too expensive and not as flexible as buses."
WSJ: The Blue State Exodus Continues: "Texas and Florida make up about 15% of the U.S. population but accounted for 70% of its population growth this past year. "
Houston ranks as the top market for tech job growth: “Although sometimes overshadowed by the cachet of Dallas, Austin, & San Antonio, Houston is absolutely a tech hub in its own right, attracting a mix of major tech companies & VC-backed startups + established base of aerospace, defense, & energy companies”
WSJ: California Long Ruled U.S. Shipping. Importers Are Drifting East. - Companies that depended on the West Coast as a point of entry for their goods are turning to other parts of the country as global trade gets upended. A chart inside shows Houston #1 in the country for port growth in containers. Looks like the port expansion is paying off!
"Bloom provided data showing strong economic incentives for both corporations and their employees to continue the work-from-home revolution if their jobs allow it:
First, “Saved commute time working from home averages about 70 minutes a day, of which about 40 percent (30 minutes) goes into extra work.” Second, “Research finds hybrid working from home increases average productivity around 5 percent and this is growing.” And third, “Employees also really value hybrid working from home, at about the same as an 8 percent pay increase on average.”
Why Houston is better with TIRZs, our lack of zoning held up as a model for the country, 45N expansion gets support, professionals migrating to TX, and more
Before getting to some smaller items, I want to comment on the Chronicle's investigative report on TIRZs (tax-increment reinvestment zones). While I'll admit they can be a bit of a mess and even a bit wasteful, what the reporters miss is that if the TIRZs were dissolved and the money sent to the City instead, it would just get gobbled up by the public employee unions long before it can do any good in any lower-income neighborhoods outside the TIRZs. As the pieces note, every mayor comes into office thinking they will go after the TIRZs, then realize they can make them work for the city as a whole by delegating projects to them (like improvements to Buffalo Bayou and Memorial parks), and shift City budget money to those neighborhoods outside the TIRZs. Finally, I think Houston's core (and the City as a whole) would be in a much more precarious position if it wasn't for the TIRZs making strong investments in Uptown, Downtown, Midtown, the Med Center, and other key districts to keep them attractive to employers and high-income professionals.
Moving on to a backlog of smaller items, mostly from my Twitter feed:
You may find it hard to believe, but Houston has the shortest CBD commuting times of the major metros due to a high-capacity freeway and HOV lane network with great coverage (Chart 5, page 7).
Video: "Of all the Texas cities - most of which I'm very bullish on - the one that is probably going to have the biggest success story for the next 30 years is by far Houston." Hat tip to George.
The City Without Zoning: "For the most part, Houston’s positives are linked to its lack of zoning, and its negatives are essentially unrelated to zoning."
The Search for Intelligent Life Is About to Get a Lot More Interesting: "In 2018, Frank attended a meeting in Houston whose focus was technosignatures... seek out signs of technology on distant worlds, like atmospheric pollution... “That meeting in Houston was the dawn of the new era, at least as I saw it,” Frank recalls."
Public comment submitted on raising I10 at White Oak Bayou: this project seems unnecessarily disruptive and expensive to keep the freeway open a relatively tiny handful of days every few years, especially given that 610 provides a natural alternative when I10 is blocked by flooding. Additionally, when the city is flooding badly enough to put I10 underwater, most households and businesses are hunkered down anyway, reducing demand. There are better places to deploy TXDoT's limited resources.
"The planned rebuild of I45 in Houston drew the largest number of comments, 382 of the 1,685 TxDOT received through a month-long public comment period. Of those, TxDOT said 299 were supportive of the project while 66 were opposed." (source)
"Houston prioritizes the ease and cost of building housing above almost all else. As a result, residents with money have a higher standard of living and those without have more humane sheltering options. Cities with other priorities sacrifice on both of these." -John Arnold
The American Conservative: How Zoning Paralyzed American Cities: "America should learn from no-zoning Houston, says Gray...What proved crucial to rejecting zoning was Houston’s allowance of deed restrictions, whereby neighbors can voluntarily opt into zoning-like restrictions and design standards...And while neighbors get a say over their neighborhood, Houston as a whole is still allowed to grow. It builds housing at 14 times the rate of its peers and, in the process, has become one of the most affordable and diverse cities in the country.""
"Is Nolan Gray really calling for zoning abolition? Yes, he is. And before you dismiss him—perhaps Houston isn’t your cup of tea, or maybe you simply like your home and its zoning, thank you very much—consider that Houstonians agreed with Nolan’s view in 1948, 1962, and 1993, killing zoning each time it came up for a vote, largely thanks to working-class voters. What proved crucial to rejecting zoning was Houston’s allowance of deed restrictions, whereby neighbors can voluntarily opt into zoning-like restrictions and design standards to ensure whatever character of their community they desire for the next 25 to 30 years. And while neighbors get a say over their neighborhood, Houston as a whole is still allowed to grow. It builds housing at 14 times the rate of its peers and, in the process, has become one of the most affordable and diverse cities in the country."
2045 RTP survey, #1 permitting, POST HTX diversity, housing costs hurt education, planning tool vs NIMBYs and their mentality
Took my visiting cousin to POST Houston Saturday night and it had the most Houston diversity I've seen in one place in 40 years here, both in food and people. Just incredible. These photos don't do it justice. Every ethnicity in the city was represented! Very cool place worth visiting if you're ever near downtown.
“Enrico Moretti (2013) estimates that 25% of the increase in the college wage premium between 1980 and 2000 was absorbed by higher housing costs. Moreover, since the big increases in housing costs have come after 2000, it’s very likely that an even larger share of the college wage premium today is being eaten by housing. High housing costs don’t simply redistribute wealth from workers to landowners. High housing costs reduce the return to education, reducing the incentive to invest in education. Thus higher housing costs have reduced human capital and the number of skilled workers with potentially significant effects on growth.”
Very cool tool that I'm also very glad Houston doesn't need because we don't need the public's approval over what gets built where: Fast Company - This ingenious tool helps cities avoid rabid NIMBY arguments over housing - Balancing Act helps calm the contentious process of deciding where housing should get built.
NYT: Twilight of the NIMBY - Suburban homeowners like Susan Kirsch are often blamed for worsening the nation’s housing crisis. That doesn’t mean she’s giving up her two-decade fight against 20 condos.
"How does a place (CA) that prides itself on progressive politics have so many policies that exacerbate inequality? How do homeowners whose window signs say they welcome every oppressed group rationalize a housing system that has caused their own children to flee?"
Market Urbanism Report: "Our latest data dive shows a clear correlation between permit rates fm 2004-2021, and current median home prices, in America's 20 "superstar" metros. Houston remains America's best metro for combining strong population/job growth with low prices. It's also had the most net permits (945,068) over this period. Not a coincidence." Hear hear! Click to enlarge the graph:
Finally, be sure you fill out the H-GAC 2045 Regional Transportation Plan survey before the end of June. They also have a Comment Map where you can add comments to very specific locations. Here was my public comment submission after attending their virtual public meeting:
"Very excited about the REAL network of managed/MaX Lanes! By far the most effective, cost-efficient, flexible, adaptable (to autonomous vehicle technology), and realistic transportation solution for a metro like Houston. Bike lanes and transit are nice amenities but will never be able to address more than a tiny slice of trips in Houston. Houston's future vibrancy and economic success is absolutely critically tied to expanding convenient, fast transportation used by the vast majority of people (cars), and if we ignore that and pretend we don't need to make any more traditional transportation expansions to accommodate growth (like freeways) we will stagnate into gridlock like LA, which has invested tens of billions into transit expansion while overall ridership *dropped*."
Metro's pretty good Inner Katy BRT plan, Ashby's corrective ordinance, induced demand from freeway expansion isn't bad, housing policy failure and success, urban exodus
I attended Metro's public meeting last week on the Inner Katy BRT+Express Bus elevated lanes and was fairly impressed with the plan. One-seat Silver line BRT ride from downtown to uptown. Easy access for 290 and I10W HOV express buses without a transfer. Uses Purple/Green LRT lanes downtown so no new lanes are lost. Good destinations like Memorial Park, POST, Theater District, GRB convention center, and Eado/PNC Stadium. One downside: HOV/HOT vehicles won't have access, and will lose access to existing elevated HOV lanes into and out of downtown. But TXDoT is planning to build their own to extend the Katy managed lanes all the way downtown. Seems a little duplicative to me. I sent this official public comment to Metro:
Just attended the public meeting and am overall impressed with the plan, but non-transit HOV vehicles losing access to the CBD ramp to downtown is problematic and could generate public blowback (I use that ramp myself quite often). As you know, that ramp bypasses a significantly congested traffic bottleneck downtown. Engineering should be possible to allow those vehicles to share the lanes on the portion between the Studemont station and downtown (with ingress and egress just east of Studemont) without significantly impacting the bus service. Or if not, please coordinate closely with TXDoT to facilitate access for those vehicles with an alternate route/lanes, maybe with a shared structure/ramp/bridge?
and got this response:
"Dear Mr. Gattis: Thank you for contacting Metro and thank you for participating in our latest public meeting. METRO is currently working with TxDOT concerning the Katy CBD Ramp. As mentioned during the virtual public meeting, TxDOT plans to tear down the Katy CBD Ramp (one lane in each direction) as part of TxDOT’s North Houston Highway Improvement Project (NHHIP). TxDOT then plans to replace the Katy CBD Ramp with managed lanes along I-10 (two lanes in each direction with shoulders) that would accommodate non-transit vehicles.
These managed lanes would go to the east side of downtown and have connections in and out of downtown to the west. During the interim of these projects (TxDOT’s NHHIP and METRO’s METRORapid Inner Katy Project), METRO and TxDOT are looking into the timing and what can be feasibly done during the time gap between these projects. As TxDOT progresses with their projects in the I-10 corridor, they will also hold public meetings in the future to provide additional information concerning the Katy CBD Ramp.
METRO appreciates your feedback regarding vehicular access and will take this into consideration during our coordination efforts. If you have any additional comments or questions, please contact us at crm.RideMETRO.org or visit RideMETRO.org/InnerKaty for more information. Thank you for contacting Metro."
Interested to hear your thoughts on it in the comments...
Moving on to a few smaller items this week:
From Wendell Cox: "The Australian Financial Review (the nation's equivalent to the WSJ) ran a piece suggesting that housing may be the most important policy failure in the nation" (based on our URI/COU Demographia International Housing Affordability Survey). I'd flip that and say housing may be Texas' and Houston's most important policy success!
"All the research suggests housing is a critical determinant of well-being and good community functionality and has long been considered an essential part of the “Australian dream”... Econometric analysis has shown that in some places in Australia, planning restrictions are responsible for 67 per cent of the cost of housing." (!!!)
“Induced demand isn’t necessarily bad or wasted VMT. Being able to get to a better job or access venues that offer better choices and lower costs isn’t bad. Businesses having access to a bigger labor pool and potential customer and supplier bases isn’t bad. Making those supply chains work better isn’t bad. Getting emergency vehicles where they need to go, faster, isn’t bad. Pulling cut-through traffic out of neighborhoods isn’t bad. Using infrastructure to shape development or improve economic competitiveness of given geographies isn’t bad."
"it seems less likely that those who purchased homes in the suburbs and exurbs during the pandemic, motivated in part by new remote work options, will be selling and moving back to cities."
Houston's mini-kaihatsu, sinking false alarm, annexation history, shrinking population, school choice, and more
Several smaller items this week:
Report: Houston is one of the fastest sinking cities on Earth, could 'disappear'. Let's check the math folks. Houston elevation is 79' = 2408cm. Losing 2cm/year x 100 years = -200cm. Sea level rise of 1cm every 5 years for 100y = 20cm. New elevation in 2122 = 2188cm, almost 72ft! Doesn't sound anywhere close to 'disappearing'...
Big NYT fail on road safety: the clear inflection point in the graph is the rise of distracting smartphones, yet they're NOT EVEN MENTIONED ONCE. Instead it's anti-car, anti-SUV, anti-speed, and anti-rideshare. All agenda instead of real problem-solving.
Kinder: Houston, Dallas led metro area growth in 2021 even as their urban cores lost population (news story, hat tip to Oscar). Harris County declining a bit even while the metro grows. I think a lot of people used the pandemic to move out to the nicer newer suburbs (commutes less of a worry in a remote work world), and the backfill immigration into the city wasn’t there as it usually is, especially from international immigrants. Crime spike hasn't helped either. Harris County really has to turn it around before we end up in the same place as Dallas County with significant outflows. Once people and employers flee, it’s a negative reinforcing cycle :-(
Book Review: The Making of Urban Japan, by Salim Furth. The review notes similarities between Tokyo's mini-kaihatsu (a dozen townhomes fronting a small alley) and similar developments in Houston:
Mini-kaihatsu, Houston
"The concept is the same, and it’s no coincidence that both arise in places with light regulation, strong demand, and little public streets funding. As I wrote about Houston:
Houstonians achieve privacy by orienting many new townhouses onto a share courtyard-driveway, sometimes gated, which creates an intermediate space between the private home and the public street…
The courtyard-driveways also provide a shared play space, as evidenced by frequent basketball hoops. Despite what Jane Jacobs may have told you, city streets are not viable play spaces for 21st-century children. But cul-de-sacs can be. Houston’s courtyard-and-grid model may be the ideal blend, unlocking the connectivity of a city while delivering the secure sociability of a cul-de-sac to a large share of homes."
"Some organisations even sent staff to Houston to watch the system at work, and a pilot of it effectively took place in Auckland with Fulton Hogan and its Milldale project.
What came out of all this broad political consensus was a new piece of legislation: the Infrastructure Funding and Financing (IFF) Act, which allows councils to set up Texas-style Special Purpose Vehicles (SPVs). It passed in 2020 with the support of every political party in Parliament, showing just how broad the surrounding consensus had grown.
Megan Woods says she is expecting three special project vehicle initiatives to come across her desk this year.
In the Houston Business Journal, Urban Reform Institute fellow Tory Gattis said: “if all goes well, there should be a tremendous increase in New Zealand housing supply in coming years which will help to ease prices.”
“Texans and Houstonians should be proud to serve as a model to the world for market-based approaches to affordable homeownership.”
Banner week for getting quoted: yours truly gets quoted at the very end of this Reason Surface Transportation Innovations newsletter on the silliness of the induced demand anti-freeway-expansion argument. As taxpayers we *want* government to invest in infrastructure where there is demand! (as opposed to so many new rail lines these days)
“We want government to invest in infrastructure that gets a high utilization (as opposed to roads to nowhere). If they built a new airport runway and it filled up with flights, people would sing the praises of such a great investment. Yet if we invest in additional freeway capacity and it fills up, it was wasted money? How does that make sense? It means the government built mobility infrastructure exactly where people needed it—where there was unmet demand—and isn’t that exactly what we want them to do as taxpayers?”
Unherd: Texas is the Future: "Texan metros, notably Houston and Austin, also are among the nation’s leading destinations for minorities and immigrants, the drivers of America’s demographic future."
Colorado Public Radio has a new four-part podcast that examines how Denver's Rail system has overpromised and under-delivered. The system is deeply in debt and is realizing that they could have a similar level of service with BRT bus lanes rather than expensive trains, a lesson Houston also learned the hard way.
"RTD took on a lot of debt during its rail-building push. Now, the fiscally-struggling agency is paring back planned rail expansion, while looking toward less costly projects that benefit core riders: bus-only lanes and bus system reorganization."
Clean energy entrepreneurship in Houston, densification, welcoming refugees, Dallas TOD failure, ADUs, population gains, rankings, and more
Continuing to clear out some backlogged smaller items. A lot of these I tweeted while I was out of town for much of the summer, but just now getting a chance to bring them to the blog:
“Every day I meet another oil and gas guy who is now a climate entrepreneur. I think there is going to be an explosion of clean energy activity out of the O&G sector, and we’ll be stunned in the next 5-7 years by how many of these problems they handle.”
"Austin isn’t the densest metropolitan area in Texas. That honor belongs to the nine-county Houston region, which increased from 1,560 residents per square mile in 2010 to 1,858 in 2020, an increase of about 19%."
"H-Town exudes Southern hospitality: The pace of life is more relaxed than many major cities, and they're welcoming, polite, and eager to share the delights of their city with visitors...make Houstonians less cliquey and more hospitable towards newcomers."
This makes me proud. Houston's doors are always open to those seeking a fresh start and new opportunity: "Volunteers from Houston Welcomes Refugees showed up with boxes of items to furnish the family’s new home." NYT: From Kabul Airport to a Houston Walmart
"In short, TOD is simply a scam. Like Portland’s light-rail mafia, which guided subsidies to favored developers who would build TODs, Dallas light rail and TODs are merely a way of transferring money from taxpayers to developers."
"There are more than 3,600 ADUs in Houston (according to HCAD data) of which the median size is 530 square feet (max allowed=900sqft). ADUs offer more housing options while maintaining the existing community character."
Political guide for moving to Texas (America's Future), Houston no-zoning video, TX HSR re-route? population growth and building permits, airport wins
Continuing from last week on catch-up items...
From Twitter: My oversimplified political guide for moving to Texas: progressives to Austin, conservatives to DFW, and pragmatic centrists and independents to Houston.
"But if you’re really looking for a bellwether state that offers a glimpse into the country’s economic future and engines of growth as well as its political fault lines in the long run, it’s not California. It’s Texas."
"For every new white resident that Texas welcomed over the past decade, there have been three Black residents, three Asians, three people with multiracial backgrounds and 11 Hispanics. Dallas-Fort Worth, Austin and Houston also have large L.G.B.T.Q. populations."
City Beautiful covers the details of Houston's lack of zoning in this 10 min video. Mostly pretty good, but I think he misses some of the densification and affordability benefits. He talks about affordability, but only on a metro level, ignoring how we're able to increase access and affordability for the most desirable core neighborhoods through new townhomes, apartments, and residential towers.
Passing this great graph along from Scott Beyer at the Market Urbanism Report: "A decade after the recession, and peak permits are still down in almost every major metro except in one state. Any mystery why this state remains affordable even as millions of people move there?" I'm impressed to see we're holding steady vs. our crazy-high peak building during a previous oil boom.
"Data from the 2020 Census released August 12 shows Houston at No. 5 (20.3 percent) among the country's 50 largest metro areas in the biggest jump in population from 2010 to 2020.
Houston maintains its position at No. 5 (7,122,240 residents), the Census data notes. For some perspective, Houston was No. 8 (4,944,332) in the 2010 Census.
The Bayou City is also one of the three U.S. metro areas to gain at least 1.2 million residents over the decade. (Dallas-Fort Worth and New York are the others.)"
MaX lanes network moves forward, 45N turmoil, Houston Story movie, immigrant magnet, downtown woes, zoning tax, and more
Apologies for the long delay between posts while on extended travels with the family. The featured item this week is TXDoT's new video promoting a managed lane network for Houston similar to what Oscar and I proposed in 2017. Can't say I'm a fan of the Regional Express Access Lanes (REAL) branding vs. Managed Express (MaX) Lanes Network, but great to see TXDoT pushing the concept forward! It would enable a high-speed nonstop ride from every part of the region to every major job center and be a major asset for the city.
City Journal: California Fleeing - Some deny the Golden State’s demographic decline, but data make it hard to ignore.
"California may be a great state in many ways, but it also is clearly breaking bad. Since 2000, 2.6 million net domestic migrants, a population larger than the cities of San Francisco, San Diego, and Anaheim combined, have moved from California to other parts of the United States."
Finally, ending on a little humor, hat tip to Barry for finding this little gem: The Houston Story movie from the 1950s. How have I never heard of it before?! Trailer, background, and even the full movie if you're so inclined. Wow.
My online event Tues, HTX #1 BBQ and #2 tech growth, R voters moving to TX, post-pandemic city shifts, ATX vs. HTX home prices, housing craziness humor, and more
Before we get to this week's items, just a reminder that my Mercatus online panel event on Land Use without Planning is 2pm CT on Tuesday. I'll be covering some of Houston's land use and zoning history as well as what other cities can learn from Houston. You can learn more and register here.
Moving on to a large backlog of items for this week:
NYT: There’s an Exodus From the ‘Star Cities,’ and I Have Good News and Bad News. Excellent summary of many different analyses forecasting post-pandemic urban geography. I’m not sure they’re right that pandemic migration will push R counties/states more D though. A lot of frustrated Rs are using the pandemic to escape D states and move to R states. For every D techie moving from SF to Austin, I'd bet 2 frustrated California Rs are moving to Texas. Actually, a recent survey found 57% of California migrants to Houston voted for Ted Cruz, which validates what I've been hearing. Here’s the most upvoted comment:
"Kotkin nails it 'Meanwhile, the working class struggles to pay rent, possesses no demonstrable path to a better life and, as a result, often migrates elsewhere.' I mean seriously is there anything worse than being poor in New York City, working a job in food service, barely able to pay your rent, knowing that you'll never own anything but an endless struggle against being evicted? Or you can move to Georgia, live cheaply in a far larger house / apt, and work towards gaining equity of something. No smart poor person would ever stay in NYC."
Excellent analysis video and paper showing that even where the land values are the same in Austin and Houston (i.e. same market demand), Austin houses are far more expensive due to over-regulation. Thanks Kevin!
"Houston ranks second among 14 major U.S. labor markets for the number of relocating software and IT workers between March 2020 and February 2021 compared with the same period a year earlier.
Miami grabs the No. 1 spot for the gain in software and IT workers (up 15.4 percent) between the two periods, with Houston in second place (10.4 percent) and Dallas-Fort Worth in third place (8.6 percent), according to the LinkedIn data."
"The big story among the nation’s major metros over the past decade has been the persistence of urban core out-migration and suburban in-migration...Houston had the 2nd-largest gain at 1.2 million, with a 20.8% increase, and remains the 5th largest metro."
"Certainly, Houstonians will be pleased with that result, but the notion that Austin might be Texas' third best city for barbecue will likely cause considerable agita in the state capital." ;-D
"It’s a melting pot, and that’s one of the things that stood out that I absolutely loved about the city. The fact that there’s a lot of positivity going on and people doing great things here, those are really some of the main reasons I stayed in the city.
Their turkey legs are decadent, sure. Like other rodeo-adjacent foods, they’re large, indulgent and full of flavor. They, in essence, are Houston."
Debating deed restrictions and zoning, office vs. remote work, transit radio show, and more
I've actually been accumulating items faster than I've been posting them, and it's gotten out of control, so this will be a long post to do some catching up.
The featured item this week is I got in an active debate with the Market Urbanist Scott Beyer on the value of deed restrictions vs. zoning, which you can read in the comments at the bottom of his piece on deed restrictions here.
Moving on to the rest of this week's items:
Dispersion in US metros increases even before Covid-19: New Census estimates. Houston growth has slowed a bit since the oil boom days, but still ahead of most other big metros. We just crossed 7 million metro population, which is an impressive achievement only 4 other US metros have accomplished (NYC, LA, Chicago, DFW).
"New York City has withstood and emerged stronger from a number of catastrophes and setbacks — the 1918 Spanish Flu, the Great Depression, the 1970s financial crisis and the 2001 terrorist attacks. Each time, people proclaimed the city would forever change — after 9/11, who would want to work or live in Lower Manhattan? — but each time the prognostications fizzled.
But this moment feels substantially different, according to some corporate executives.
The economy is in a sustained nosedive, with unemployment reaching levels not seen since the Great Depression. Many companies are in financial trouble and may look to shrink their real estate as a way to cut expenses.
More fundamentally, if social distancing remains a key to public health, how can companies safely ask every worker to come back?
“If you got two and a half million people in Brooklyn, why is it rational or efficient for all those people to schlep into Manhattan and work every day?” said Jed Walentas, who runs the real estate company Two Trees Management. “That’s how we used to do it yesterday. It’s not rational now.”
“We have a lot of millennial buyers who are already used to working remotely. They don’t know how long this (pandemic) is going to last, and they’d rather be here (Tahoe),” Bednar told the Tribune, “The people I’m talking to are looking for a simpler life, a close community. They want the outdoors and don’t want to be stuck in places where there’s a health problem.” ...
“People are starting to ask themselves, ‘Why do I have to live in such an expensive area and drive an hour to work every day, or rent out an expensive office space when everyone can work remotely?' If you don’t need to live in the city, why would you?” Bednar said.
“The COVID-19 pandemic forcing those who could work from home to do so has led to a surprising result — improved productivity. U.S. workers were 47% more productive in March and April than in the same two months a year ago through cloud-based business tools, chat applications and email, according to an analysis of 100 million data points from 30,000 Americans by workplace-monitoring company Prodoscore.”
...
“Our salespeople meet five to eight customers a day now [via videoconferencing] versus the one it took them three days [to see in the past] because of travel,” he added.
This gets reinforced in the comments of a pro-office op-ed in the NYT, which are at least worth skimming. Even though the author makes a case for some of the benefits of the office, the overwhelming sentiment in the comments is “screw that, I love working from home and not commuting!” for all sorts of reasons, including less office drama/politics and fewer worthless meetings. It’s clear to me that both overwhelming sentiment, as well as simple economics/costs, work against offices. I think they will go into a significant decline. One other point the author misses is that you can separate the social aspect from the work aspect with the rise of coworking spaces, which are exploding everywhere: a shared space where there are others you can interact with, but everyone works for different companies. Still get the networking and socialization without the long commute to one central office with all of your company’s other employees.
"An important step is simply to permit more housing in more locations. We should put an end to zoning policies that restrict building to single-family homes and stop mandating that lots meet large minimum-size requirements, leading to sprawling, sparsely populated neighborhoods. Ending such restrictive zoning doesn’t have to lead to the construction of towering apartment buildings. Rather, we should encourage cities to permit more homes on existing single-family lots, allow apartments in retail districts and near transit, and dedicate excess or underused public property like surface parking lots in downtowns to new housing. All of this can be done without materially changing the look, feel and experience of a place.
The second important step is to reduce the cost and uncertainty of getting a housing project built. It often takes years to get permission to build. Local government processes often allow multiple “bites at the apple” of public comment and hearings for a plan. Sometimes, even when there is a vote to approve a project, a neighbor or special interest can sue to stop the approval, resulting in further significant delay. These delays add cost and risk, driving up the price of new homes and sometimes stopping projects in their tracks entirely.
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These types of actions, which can be taken now, will lay the groundwork for a broad and shared prosperity. When denser housing is allowed, workers can live closer to their jobs, help save the planet by driving less and pay less in rent or mortgage payments because a bigger housing supply will lead to lower costs. Research shows that children tend to be more successful in neighborhoods with access to high-quality schools. In restricting building, more-affluent Americans are shutting lower-income families off from economic opportunity.
Now is an especially good time to reduce restrictions and allow for denser housing. Construction is hit hard during recessions, and opening up more building opportunities would be a stimulus for the industry, and it doesn’t require any extra funding. This would get workers back to work, provide safe and affordable living for those hard hit by this pandemic and get property taxes and other revenue flowing back to local governments for the services communities need. It would be a win for everyone."
"Without a significant expansion in the supply of housing, adding vouchers would be like adding players to a game of musical chairs without increasing the number of chairs.
Market-rate construction can help: More housing would slow the upward march of housing prices. New York and San Francisco are the nation’s most tightly regulated markets for housing construction, and it is not a coincidence that they also are the most expensive. Tokyo, often cited as an international model for its permissive development policies, has expanded its supply of homes by roughly 2 percent a year in recent years, while New York’s housing supply has expanded by roughly 0.5 percent a year. Over the last two decades, housing prices in Tokyo held steady as New York prices soared."
Finally, I'd like to end with a radio show I did with Bill King along with Carrin Patman and Tom Lambert of METRO on what's happening with the past, Covid present, and potential future of transit. Apologies for my bad body language - I didn't even realize I was being videoed until over halfway through, lol. I was just focused on my notes and getting the audio right.
"Houston Public Works has pulled proposals to permanently close the Brazos Street bridge and implement new pedestrian features around a corridor threaded between the Montrose area and Midtown.
“Please be advised that the Houston Public Works Department along with Mayor Turner has made the decision to resume the project with the original design,” reads a Public Works notice sent to stakeholders on April 2."
"Of the 10 counties with the largest population growth in the country between 2010 and 2019, six of them are in Texas. Harris/Houston had the 2nd largest population increase adding more than 620,000 people just behind Maricopa/Phoenix."
"Large metro areas had the steepest decline over the course of the decade, Mr. Frey found in an analysis, with the growth rate down by nearly half. Rural areas, in contrast, grew slightly by the end of the decade, though that followed several years of declines.
Places that had once been popular destinations for young people — New York, Los Angeles and Chicago — ended the decade with some of the biggest declines. New York began losing population in 2017, and last year it registered a loss of more than 60,000 people, the biggest population decline of any American city, Mr. Frey found.
The housing market collapse of 2008 and the rising prices in suburbs prompted millennials to move to big coastal cities. But that pattern reversed by mid-decade, Mr. Frey said, as millennials fled rising rents and home prices.
Places with the biggest gains for the decade were Dallas, Houston, Phoenix, Atlanta and Washington, D.C. Medium-size metro areas, like Las Vegas, have also moved up the ranks of gainers, as have Charlotte, N.C.; Seattle; and Austin, Texas.
"The experience of Los Angeles County — with its dense urbanization and ideal weather — should be a warning to those, in California and elsewhere, who assume that high density, “transit oriented development” and substituting transit for driving alone naturally go together. In fact, they do not."
Providing additional buses and drivers to handle the additional demand of a 36% increase in ridership from going fareless could cost up to $170m a year on top of Metro's roughly $700m budget, and they simply can't afford that.
The safety risks are substantial with "problem riders", which have been an issue when other agencies have gone fareless.
I was impressed with Metro's thorough analysis of six different scenarios, and satisfied that they came to the right (albeit unfortunate) conclusions. I agree that the cost and safety concerns are just too high for most of the scenarios they analyzed. They are still analyzing additional scenarios and I have suggested it would be interesting to add a scenario with a fixed-price unlimited monthly pass, including for Park-and-Ride riders. I’m not sure what the right price point would be - maybe at the equivalent of two local rides a day? - so $2.50 x 30 days = $75/month? I think that could get a substantial boost in ridership (especially Park-and-Ride commuters) without the safety concerns or major loss of revenue. We'll see what comes back...
"Texas Monthly told a story that a lot of people wanted to hear: loosely regulated housing markets like Houston have long embarrassed ideological opponents of free markets who insist that only rent controls and massive public subsidies can provide affordable housing. There is a ready audience for the argument that Houston’s affordability is a mirage. If you ever find an argument like this tempting, though, ask yourself: is it more likely that you’re mistaken, or that the millions of Americans voting with their feet are?"
Nobody wants to leave Houston! Well, I might be exaggerating a bit, but this CityLab piece shows Houston as the 9th most popular city for inbound apartment searches, but doesn't even make the top 20 for outbound apartment searches (which does include both Dallas and San Antonio). And Houston and Miami were the only top ten metros not on the outbound list - not bad company! I think that's a really nice sign for your city when there's a lot more inbound interest than outbound, even with the oil bust.
Media coverage for eliminating Metro fares, HTX accolades, growth, and density revolution - and are we really gentrifying that fast?
The featured news this week is that I was interviewed on both local NPR/KUHF and KPRC about my proposal that Metro eliminate fares. Hopefully, we'll hear some positive news on it from Metro during their upcoming board meeting.
Moving on to other items this week:
Chronicle: Houston gentrifying faster than other Texas cities, Fed analysis finds. What I think this analysis misses is that Houston's lack of zoning allows densification much more easily than other cities, and we have created tens of thousands of new apartments, condos, and townhomes near downtown in recent years allowing higher-salaried newcomers without necessarily displacing existing residents. I'm not saying gentrification and displacement is not happening (I'm sure some is), but average incomes can certainly move up substantially by adding new residents to new density without displacing existing ones.
"When you choose a place to live, you have to strike a balance between what you want and what you need. Big cities have lots of amenities and job opportunities, but they're often extremely expensive. Smaller areas tend to be a lot more affordable, but you might not be able to come close to earning as much money as you want in order to achieve your financial goals.
But if you want the best of both worlds, there's one city among the largest metropolitan areas in the U.S. that strikes the right balance. As research from The Ascent into salaries and costs of living discovered, the Texas city of Houston should be high up on your list if you want a major population center that won't strain your wallet.
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One reason Houston has been able to keep itself as affordable as it has is that it lacks the extensive land use regulation that many similarly sized communities have. In many cities, zoning laws make it difficult for real estate developers to build new projects to provide more housing for residents, and that can keep housing prices artificially high. That hasn't been the case in Houston, where ample land has allowed the city and its suburbs to expand outward and support a growing population.
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For those seeking a big-city experience but wanting to stick to a budget and even put some money in the bank, Houston offers an attractive balance. With everything a major metropolitan area can offer at a fraction of the price tag you'll find in many similarly sized cities, Houston's worth a closer look for those who want it all."
"Perhaps more impressive is how much Texas expanded from April 2010 (when the last official U.S. headcount was conducted) to July 2019. During that period, Texas added 3,849,790 residents, according to the Census Bureau. To put that into perspective, nearly 4 million people live in the entire state of Oklahoma. Texas' population jumped 15.3 percent from 2010 to 2019, the third highest growth rate behind the District of Columbia and Utah.
Experts cite economic and job growth — along with a low cost of living, a low cost of doing business, and low taxes compared with many other states — as drivers of Texas' population boom. Helping fuel the boom are substantial population spikes in the state's four largest metro areas: Austin, Dallas-Fort Worth, Houston, and San Antonio."
Finally, I'd like to end this week's post with a video of one of our COU events. It's a bit long, but a good one to leave on in the background while working at your computer. SMU-Cox Folsom Institute for Real Estate, the SMU Economics Center, and the Center for Opportunity Urbanism presented a lively discussion on Cities, Suburbs, and the New America, and Minorities, Immigrants, and Millennials in America’s Favorite Geography. The event featured presentations from former Secretary of Housing and Urban Development Henry Cisneros, author Joel Kotkin, and MIT Professor Alan Berger.
"Austin is one of the fastest-growing cities in America, and the city of Austin and Austin’s transit agency, Capital Metro, have a plan for dealing with all of the traffic that will be generated by that growth: assume that a third of the people who now drive alone to work will switch to transit, bicycling, walking, or telecommuting by 2039. That’s right up there with planning for dinner by assuming that food will magically appear on the table the same way it does in Hogwarts.
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Planners have developed two main approaches to transportation. One is to estimate how people will travel and then provide and maintain the infrastructure to allow them to do so as efficiently and safely as possible. The other is to imagine how you wish people would travel and then provide the infrastructure assuming that to happen. The latter method is likely to lead to misallocation of capital resources, increased congestion, and increased costs to travelers.
Austin’s plan is firmly based on this second approach. The city’s targets of reducing driving alone by a third, maintaining carpooling at an already too-high number, and increasing transit by 394 percent are completely unrealistic. No American city has achieved similar results in the past two decades and none are likely to come close in the next two decades."
Animated graph of Where Americans are Leaving: Net Domestic Migration Out Of Metro Areas 2010-2018. Mostly the big 3 of NYC, LA, and Chicago, but Houston does appear at the bottom near the end. Harvey losses I assume. Excerpt:
"People vote with their feet. Sunbelt states overall offer stronger economies, more job opportunities, better weather, and lower taxes. These trends may have political implications, as “blue state” residents move to “red” states, perhaps making them more “purple.”"
Finally, while we're all disappointed in how the World Series turned out (how the heck did the home team lose *every* game?!), there is a small silver lining in the ad Nationals fans put in the Chronicle, which I think is an excellent example of Houspitality!
An open dialogue on serious strategies for making Houston a better city, as well as a coalition-builder to make them happen. All comments, email, and support welcome.
