Census data would show otherwise. A lot of the fastest growing cities have large suburban growth, and it's is 2020s. Florida, Texas, Colorado, Arizona, Tennessee.
Growth rates are much lower than they were before 2008. You can think of the US housing market as a combination of a shared cyclical rise and fall of housing demand per capita across all cities, with some cities taking in migrants and growing more while others emit migrants and don't grow. The variance of growth since the Great Recession is much lower than it was before the Great Recession. So, comparing Orlando in 2022 to NYC in 2022, you can say that the faster growing city is growing more suburbs. But, Orlando in 2022 is growing much less than Orlando in 2005.
Agree, just seems like growth is occurring fastest in cities and states that allow suburban growth, and most of the growth even if slower is occurring in their suburban-ish areas. Just an observation.
If housing cost drive population movement my hunch is part of that is single family housing.
That's part of housing deregulation just like up zoning.
Whether that's good, bad or ugly is a whole different issue.
Basically, before 2008, when incomes rose, construction in Florida increased. After 2008, when incomes rise, rents in Florida increase and construction goes up a little bit.
I was intrigued by your observation that: "Single-family homes in the exurbs was the band-aid on our broken city-building governance."
I might be reaching a bit on this, but the exurban surge basically describes the post war housing boom, which coincided with significant declines in urban core populations that reached its nadir in the late 1970's. Based on the graphs in this post, you set the game clock in the 1990's, when outer ring suburbs were starting to max out land capacity with low density development. By that point, many older cities were in full resurgence--but the regulatory screws were being tightened dramatically so that functionally obsolete neighborhoods persisted and enjoyed the massive surges in values that became the sacred trust of single family homeowners.
The hammer blow of the Great Recession and the endurance of tightened lending standards has had the pernicious effect of propping up home values in places that defy common sense---i.e. dilapidated houses in remote locations command high prices because of the broad scarcity. Meanwhile, second tier cities still have run-down urban cores which still haven't recovered from the value collapse of the 1960's and 1970's.
Granted, I'm talking more about the Northeast than other parts of the U.S. Somebody like Ed from Austin still seems to be operating in a real estate environment that resembles the 1990's---but the money flows are far more constrained now than they were then. Large scale apartment developers in metro Boston face remarkable challenges with site acquisition, permitting, and construction. The payoff is always guaranteed in terms of rental capacity because of the supply environment, but it's a brutal process.
Good question. The exact correction is a minor qualitative point in the original paper and the explanation of the correction would be complicated. I think, in this case, it would be difficult to make a concise update that would be useful to the reader. Maybe eventually all this will make it into a new Mercatus paper and I can insert a footnote into the original paper directing the reader to the new paper for further discussion.
Census data would show otherwise. A lot of the fastest growing cities have large suburban growth, and it's is 2020s. Florida, Texas, Colorado, Arizona, Tennessee.
Growth rates are much lower than they were before 2008. You can think of the US housing market as a combination of a shared cyclical rise and fall of housing demand per capita across all cities, with some cities taking in migrants and growing more while others emit migrants and don't grow. The variance of growth since the Great Recession is much lower than it was before the Great Recession. So, comparing Orlando in 2022 to NYC in 2022, you can say that the faster growing city is growing more suburbs. But, Orlando in 2022 is growing much less than Orlando in 2005.
Here's a post on a paper where I laid this out.
https://kevinerdmann.substack.com/p/home-price-trends-point-to-a-worsening
Thanks for the link. Long read.
Agree, just seems like growth is occurring fastest in cities and states that allow suburban growth, and most of the growth even if slower is occurring in their suburban-ish areas. Just an observation.
If housing cost drive population movement my hunch is part of that is single family housing.
That's part of housing deregulation just like up zoning.
Whether that's good, bad or ugly is a whole different issue.
Basically, before 2008, when incomes rose, construction in Florida increased. After 2008, when incomes rise, rents in Florida increase and construction goes up a little bit.
https://fred.stlouisfed.org/graph/?g=1ikU1
And post meltdlown the supply chain shrank which prevented multifamily construction to pick up the slack.
I was intrigued by your observation that: "Single-family homes in the exurbs was the band-aid on our broken city-building governance."
I might be reaching a bit on this, but the exurban surge basically describes the post war housing boom, which coincided with significant declines in urban core populations that reached its nadir in the late 1970's. Based on the graphs in this post, you set the game clock in the 1990's, when outer ring suburbs were starting to max out land capacity with low density development. By that point, many older cities were in full resurgence--but the regulatory screws were being tightened dramatically so that functionally obsolete neighborhoods persisted and enjoyed the massive surges in values that became the sacred trust of single family homeowners.
The hammer blow of the Great Recession and the endurance of tightened lending standards has had the pernicious effect of propping up home values in places that defy common sense---i.e. dilapidated houses in remote locations command high prices because of the broad scarcity. Meanwhile, second tier cities still have run-down urban cores which still haven't recovered from the value collapse of the 1960's and 1970's.
Granted, I'm talking more about the Northeast than other parts of the U.S. Somebody like Ed from Austin still seems to be operating in a real estate environment that resembles the 1990's---but the money flows are far more constrained now than they were then. Large scale apartment developers in metro Boston face remarkable challenges with site acquisition, permitting, and construction. The payoff is always guaranteed in terms of rental capacity because of the supply environment, but it's a brutal process.
Thanks for going up and reporting on your mistakes! Will you update the paper?
Good question. The exact correction is a minor qualitative point in the original paper and the explanation of the correction would be complicated. I think, in this case, it would be difficult to make a concise update that would be useful to the reader. Maybe eventually all this will make it into a new Mercatus paper and I can insert a footnote into the original paper directing the reader to the new paper for further discussion.
Thanks! Perhaps in the meantime you can insert a footnote that links to this blog post?
OK. For the first time I think fully I get the supply side argument.