I totally agree with your analysis of the housing problem, but sometimes I feel there's a bit of a blindspot around the interactions between housing and "urbanism." A list of "most urbanist US cities" has a lot of overlap with the closed-access cities - NYC, Boston, SF. Then DC, Chicago, Philly, and to a lesser extent Seattle, Portland, and Minneapolis probably round out a "best US urbanism" list, which might be cheaper, but all still have housing production problems of their own.
Since college-educated people tend to prefer walkable urbanism, and can afford it, "opportunity" will coalesce around these places. I'm thinking along the lines of Ed Glaeser's "Triumph of the City," or Joe Cortright at City Observatory
Young talented people graduate college and want to move to the city. You want to be a city that attracts those young, talented people, because if you attract and retain them, they will pay your city dividends for the rest of their life. Those young, talented people are attracted to "city life," and that means, at its core, walkability. Even if they move to the suburbs later, as long as they remain attached to the metro area, they're still contributing to the city's economy. This is what I see as making NYC, SF, Boston, DC, etc., "special," both culturally and economically—concentration of educated people. The "superstar" designation on the basis of incomes might be spurious, but the idea that these are special and uniquely desirable places is not.
LA is really in a category of its own of lacking walkability, but still being desirable to powerful/"special" people because of entertainment industries. That makes perfect sense because a lot of what makes walkable cities special isn't that they're /broadly/ more desirable, it's that they're more desirable to people who have more powerful voices. Of course people in entertainment have very powerful voices, and so LA gets mega-bonus "culture" points that are amplified out in our movies and TV and music.
From this premise, I'll admit, San Diego just makes no sense at all. It is obvious though, that San Diego has some of the best weather in the world, and people are really irrational about how much they'll pay for good weather. I'll just have to chalk some of this up to the insanity of California.
From this argument, San Jose also gets irrational "California" points, rides off the coattails of SF's walkability a little (young people who reverse commute down the peninsula from the city, then move south when they get older), and has some agglomeration head start because of Stanford and the military research history.
Joe Cortright has also written pieces observing how much the presence of good universities has determined the trajectory of US cities, because educated people finish school and decide to stay.
It's not a blindspot. In fact, I wrote 2 books still believing that idea, to some extent. It has only been after living with the data for a decade and analyzing it the way I do for the tracker that I slowly lost faith in it. To a first approximation, it's all supply. Some cities are better, more interesting, urban environments than others. It has little to do with affordability.
I think the whole idea that there is a set of young professionals that have become especially attracted to walkable cities is a false theory that arose to explain high costs. Not a false theory. A reasonable theory that has been misapplied. They exist, and maybe they exist more than they used to. But, what made them noticeable is the high costs, and the high costs have nothing to do with them.
If you haven't seen them, and you're interested, here is one post about the different amenities people pay for in cities, and who pays for them:
Even if the elite demand for walkability is not causal of high prices, I think it's fair to say that it's a problem that only about 10 cities in the US are particularly "urban" and that ALL of the demand to live at New York City levels of intensity has no release valve. And that the housing shortage is an opportunity to address those problems. To say that San Francisco should approach Brooklyn levels of density, and Seattle should approach San Francisco levels of density, and Portland should approach Seattle levels of density, seems to me a sensible way of addressing the problem while also creating better quality of life for Americans as compared to more expensive super-commutes from single family homes at the edge of town.
I think that regional bias is embedded in human thinking. It takes the form of "our cave is nicer than your cave" and "The Joneses have a nicer cave than ours--let's go kill them." Comparisons, resentments, and place-based loyalties will always factor into the prices that people are willing to pay for housing. Every country will have a dominant metropolitan area that is regarded as THE CITY by virtue of population and the inhabitants will reap considerable benefits from agglomeration--at the same time as they're complaining about prices, congestion, and the constant failures of their local sports teams.
However, agglomeration theory doesn't imply that you can rank metro areas in a large country like the U.S. and conclude that any place with less than 5,000,000 people is Crapville. Nor can you look at certain metro areas on the basis of housing price and conclude that they've reached a point of population saturation because of those prices---which ties back to your debate w/ Yglesias & Sumner. A benefit of agglomeration should be a "superfiltering" of housing price points and a broad spectrum of living conditions. In many places in the world billionaires live in high rises a few blocks away from crowded slums. A natural policy goal isn't to get rid of the billionaires but to raise the housing standards of the slum-dwellers--which is basically what Singapore did (and China has been trying to do, but with some recent setbacks).
I totally agree with your analysis of the housing problem, but sometimes I feel there's a bit of a blindspot around the interactions between housing and "urbanism." A list of "most urbanist US cities" has a lot of overlap with the closed-access cities - NYC, Boston, SF. Then DC, Chicago, Philly, and to a lesser extent Seattle, Portland, and Minneapolis probably round out a "best US urbanism" list, which might be cheaper, but all still have housing production problems of their own.
Since college-educated people tend to prefer walkable urbanism, and can afford it, "opportunity" will coalesce around these places. I'm thinking along the lines of Ed Glaeser's "Triumph of the City," or Joe Cortright at City Observatory
Link: https://cityobservatory.org/the-talent-divided-2018/
and link: https://cityobservatory.org/youth_movement_june2020/
Young talented people graduate college and want to move to the city. You want to be a city that attracts those young, talented people, because if you attract and retain them, they will pay your city dividends for the rest of their life. Those young, talented people are attracted to "city life," and that means, at its core, walkability. Even if they move to the suburbs later, as long as they remain attached to the metro area, they're still contributing to the city's economy. This is what I see as making NYC, SF, Boston, DC, etc., "special," both culturally and economically—concentration of educated people. The "superstar" designation on the basis of incomes might be spurious, but the idea that these are special and uniquely desirable places is not.
LA is really in a category of its own of lacking walkability, but still being desirable to powerful/"special" people because of entertainment industries. That makes perfect sense because a lot of what makes walkable cities special isn't that they're /broadly/ more desirable, it's that they're more desirable to people who have more powerful voices. Of course people in entertainment have very powerful voices, and so LA gets mega-bonus "culture" points that are amplified out in our movies and TV and music.
From this premise, I'll admit, San Diego just makes no sense at all. It is obvious though, that San Diego has some of the best weather in the world, and people are really irrational about how much they'll pay for good weather. I'll just have to chalk some of this up to the insanity of California.
From this argument, San Jose also gets irrational "California" points, rides off the coattails of SF's walkability a little (young people who reverse commute down the peninsula from the city, then move south when they get older), and has some agglomeration head start because of Stanford and the military research history.
Joe Cortright has also written pieces observing how much the presence of good universities has determined the trajectory of US cities, because educated people finish school and decide to stay.
It's not a blindspot. In fact, I wrote 2 books still believing that idea, to some extent. It has only been after living with the data for a decade and analyzing it the way I do for the tracker that I slowly lost faith in it. To a first approximation, it's all supply. Some cities are better, more interesting, urban environments than others. It has little to do with affordability.
I think the whole idea that there is a set of young professionals that have become especially attracted to walkable cities is a false theory that arose to explain high costs. Not a false theory. A reasonable theory that has been misapplied. They exist, and maybe they exist more than they used to. But, what made them noticeable is the high costs, and the high costs have nothing to do with them.
If you haven't seen them, and you're interested, here is one post about the different amenities people pay for in cities, and who pays for them:
https://kevinerdmann.substack.com/p/what-kind-of-good-is-housing
Here's a post about the basket of services we buy when we consume housing, and how that plays out in expensive cities:
https://kevinerdmann.substack.com/p/the-consumption-basket-we-call-housing
Thanks for your response - very clarifying.
Even if the elite demand for walkability is not causal of high prices, I think it's fair to say that it's a problem that only about 10 cities in the US are particularly "urban" and that ALL of the demand to live at New York City levels of intensity has no release valve. And that the housing shortage is an opportunity to address those problems. To say that San Francisco should approach Brooklyn levels of density, and Seattle should approach San Francisco levels of density, and Portland should approach Seattle levels of density, seems to me a sensible way of addressing the problem while also creating better quality of life for Americans as compared to more expensive super-commutes from single family homes at the edge of town.
Hear! Hear!
I think that regional bias is embedded in human thinking. It takes the form of "our cave is nicer than your cave" and "The Joneses have a nicer cave than ours--let's go kill them." Comparisons, resentments, and place-based loyalties will always factor into the prices that people are willing to pay for housing. Every country will have a dominant metropolitan area that is regarded as THE CITY by virtue of population and the inhabitants will reap considerable benefits from agglomeration--at the same time as they're complaining about prices, congestion, and the constant failures of their local sports teams.
However, agglomeration theory doesn't imply that you can rank metro areas in a large country like the U.S. and conclude that any place with less than 5,000,000 people is Crapville. Nor can you look at certain metro areas on the basis of housing price and conclude that they've reached a point of population saturation because of those prices---which ties back to your debate w/ Yglesias & Sumner. A benefit of agglomeration should be a "superfiltering" of housing price points and a broad spectrum of living conditions. In many places in the world billionaires live in high rises a few blocks away from crowded slums. A natural policy goal isn't to get rid of the billionaires but to raise the housing standards of the slum-dwellers--which is basically what Singapore did (and China has been trying to do, but with some recent setbacks).
I don’t understand using income growth for the X axis. Shouldn’t we use some measure of RE prices or rent?
What supposedly makes them special is the high incomes. The charts are intended to show that they aren't.