Here the Pope is arguing that our communities have been spoiled by all our cars:
The quality of life in cities has much to do with systems of transport, which are often a source of much suffering for those who use them. Many cars, used by one or more people, circulate in cities, causing traffic congestion, raising the level of pollution, and consuming enormous quantities of non-renewable energy. This makes it necessary to build more roads and parking areas which spoil the urban landscape. Many specialists agree on the need to give priority to public transportation. Yet some measures needed will not prove easily acceptable to society unless substantial improvements are made in the systems themselves, which in many cities force people to put up with undignified conditions due to crowding, inconvenience, infrequent service and lack of safety.
Free parking may sound like an unalloyed good, but the refusal of Americans to pay for—or indeed charge for—parking has created all sorts of bizarre incentives, says Donald Shoup of the University of California. People choose to drive when, if they paid the real cost of parking, they would walk or take a bus. And congestion is made worse. In some cities, Mr Shoup estimates, as much as a third of traffic consists of people searching for a space to park.
In Adams Morgan, a bustling part of Washington, DC, the problem is immediately apparent. The streets are clogged and drivers circle, looking for spaces to come up. Residents pay just $35 a year for a street-parking permit, but since demand outstrips spots, finding a space can be fiendishly difficult. Time-strapped commuters often don’t use their cars for fear of being unable to park when they return home.
The (unweighted) mean and median of the 14 house price indices are shown in Figure 1. Adjusted by the consumer price index, house prices in the early 21st century are well above their late 19th-century level, and increased in all advanced economies in the long run. Yet their trajectory is distinctive. Using the new dataset, we are able to show that they follow a hockey-stick pattern – real house prices remained broadly stable from the late 19th century to the mid-20th century, and increased strongly in the following decades. Real house prices have approximately tripled since 1900, with virtually all of the increase occurring in the second half of the 20th century, as Figure 1 shows.
We also find considerable cross-country heterogeneity in long-run house price trends. While Australia has seen the strongest, Germany has seen the weakest increase in real house prices. Moreover, in the paper we also demonstrate that urban and rural house prices as well as farmland prices display similar long-run trends.
Figure 1. Mean and median real house prices, 1870–2012
Note: CPI-deflated nominal house prices for 14 economies.
What explains the fact that residential land prices remained stable until the mid-20th century and increased strongly thereafter? Our explanation focuses on the different dynamics in land supply in these two periods. From the 19th to the early 20th century, the transport revolution – mostly the construction of the railway network, but also the introduction of steam shipping – led to a massive and well-documented drop in transport costs (Jacks and Pendakur 2010). An important side effect of the transport revolution was to substantially augment the supply of economically usable land.
In the paper, we develop a model with land heterogeneity to demonstrate how a sustained decline in transport costs endogenously triggers an expansion of land, such that the land price may remain low despite continuous growth of income and population. We also show that this land-augmenting decline in transport costs subsides in the second half of the 20th century, so that land increasingly became a fixed factor.
This is really interesting stuff. In particular, I found their observation that farmland prices have followed the same trend as house prices – see Figure 22 in the paper – surprising.
Tenants need to feel as if their rental really is a place to call home while they are there. Along with that comes flexibility to decorate, feel secure that (provided they meet their obligations under the tenancy agreement) they cannot be given short-term notice.
This security, however, is balanced with some responsibilities. For example, USA tenancy agreements include the need for tenants to organize and pay for all repairs under $150. The property is to be handed back to the landlord in the same state of repair it was rented.
On the flip side the landlord needs to give tenants the opportunity to settle down without the potential for a tenancy to be terminated with as little as 45 days notice.
The common culture of using periodic tenancies can be updated to take advantage of the security offered through fixed term contracts. Landlords can consider suggesting this option and prospective tenants seeking a more permanent place to stay should feel confident proposing a fixed term.
New research from the Urban Institute shows that the supply of housing for extremely low-income families, which was already in short supply, is only declining. In 2013, just 28 of every 100 extremely low-income families could afford their rental homes. Than figure is down from 37 of 100 in 2000—a 25 percent decline over a little more than a decade.
Using data from the Census Bureau and the U.S. Department of Housing and Urban Development, researchers built an interactive map to illustrate the nationwide reach of the problem. In no county in the U.S. does the supply of affordable housing meet the demand among extremely low-income households. (Families who made no more than 30 percent of an area’s median household income were considered “extremely low income.”)
In Travis County, Texas, for example, the extremely low-income cutoff for a family of four is $21,950. There are about 7,000 safe, affordable rental units to meet the needs of these poor Austin families. But there are more than 48,000 extremely low-income families living there.
Dylan Cleaver, “Lost playgrounds“, NZ Herald. A great bit of local history on sports grounds like Carlaw Park that have been redeveloped or paved over:
In many respects, the disappearing parks and sports ground shuffles shine a light of Auckland’s uniqueness, or what historian Professor Emiritus Russell Stone calls “exceptionalism”.
A century ago, Auckland’s population was 134,000, about one-tenth of what it is today. After WWII in particular, it started growing at a rate that was far outstripping the rest of the country.
“One of the fundamental problems was always where to distribute the people and where to locate the sports grounds,” Stone said.
Sport was no less popular than it is today, although it was far less of a business. For many Aucklanders, there were only three reasons to leave the house in the weekends – church, the movies or sport. All three had comparatively far higher attendance in the days before television and home-entertainment systems.
They didn’t mind walking. Auckland was, says the professor, a pedestrian city, so those in Ponsonby, on the city’s western fringe, would have thought little about walking 8km to Potter’s Paddock to see the All Blacks play their first test in Auckland, against the Anglo-Welsh in 1908.
And now for a rural version of the same phenomenon:
Sooner or later, every road comes to an end—but not in Vermont. In other states, a road that goes unused for a reasonable period of time is legally discontinued; in Vermont, any road that was ever officially entered into a town’s record books remains legally recognized, indefinitely. It doesn’t matter if the road has not been travelled in two hundred years, or if it was never travelled at all, or if it was merely surveyed and never actually built. Any ancient road that exists on paper—unless it has been explicitly discontinued—is considered a public highway in the eye of the law.
As a result, over decades and centuries, Vermont has become filigreed with rural roads and pathways that hardly anyone but the law can see. In 2003, a couple in the town of Chittenden was denied permission to build an extension onto their home when an independent researcher, hired by the town, discovered an ancient mail route passing right through their property. In the tiny hamlet of Granville, a survey revealed a long-lost, invisible throughway passing through the wooded front yard of a mountain home; a pending lawsuit may open the road to traffic from timber-company trucks. In 2006, prompted by a groundswell of complaints from Vermonters unable to obtain title insurance for their properties or to keep snowmobilers out of their flowerbeds, the state government passed Act 178, which aimed to brush away the infrastructural cobwebs. The act gave the towns until February of 2010 to identify and map any potential ancient roads within their borders; these would then be reviewed by the state and added to Vermont’s official highway map over the next five years. Any ancient road not added to the state map by July 1, 2015, would be considered discontinued.
The Act’s passage inspired a kind of statewide archive fever. Interested citizens, outdoors enthusiasts, industrial forestry advocates, and concerned homeowners began visiting town-records offices and poring through vaults, shelves, and filing cabinets stuffed with yellowing and re-bound handwritten notes, property transfers, mortgage deeds, and step-by-step narrations of particular routes across the landscape dating back as far as the seventeen-nineties. In a few cases, the ancient road under review actually predated Vermont’s statehood.
Cities that actively promote physical activities enjoy an economic advantage, research has suggested.
It says areas designed for physical activities have increased retail activity and revenue, and lower healthcare and crime costs.
The report’s authors describe active cities as urban areas with easy access via cycling or walking to parks, schools and workplaces.
The details have been presented at an Active Cities Summit in Bristol, UK.
The findings – compiled by a team from the University of California, San Diego – identified five “settings” in an urban environment that encouraged physical activity:
Open spaces and parks: ensuring residents lived near a green space; accessible and safe fitness trails
Urban design: mixed-used communities; streets designed for safe and enjoyable cycling and walking
Transportation: infrastructure to support cycling an walking; access to safe and reliable public transport
Schools: located near students’ homes; recreational and exercise facilities
Buildings and workplaces: encourage physical activity, eg visible stairs etc
Jamie Morton, “Bigger cities make brighter ideas“, NZ Herald. They seem to have mixed up the headline – the study has actually found that diverse firm ecosystems are more important than size:
Having a blend of brains and not just a bulk of them is what makes big cities like Auckland more likely to produce clever new inventions, Kiwi researchers have found.
A study led by University of Auckland researcher Dr Dion O’Neale, presented last week to a conference in Spain, investigated the relationship between the mix of technological specialty in more than 4000 places and cities, and the novelty of the patented products that sprouted from them.
It found that the rate of innovation didn’t necessarily reflect the number of researchers in a particular place – and that having a wide range of different work going on was often the real difference.
Study co-author Professor Shaun Hendy, the director of Te Punaha Matatini, a new Centre of Research Excellence hosted by Auckland University, said the same could be said of a rainforest.
“In natural ecosystems, you find rarest species in the areas with the highest biodiversity – the same applies to innovation,” he said.
“It’s consistent with this idea that has been around for a while, that new ideas are the recombinations of old ideas – and we’d suggest the more diverse technological base you have, the more opportunities you have got for combining things in new ways and coming up with novel ideas.”
So for the insurer, it was better to cut the owners a cheque for the $700,000, a quick cash settlement that lets both sides walk away.
Ka-ching, I suggest. Park nods agreement.
Without wanting to reveal too much, he says the owners in their mid-50s now have enough dosh to buy a new house closer to town and also stick what is left-over in a rental investment property. Plus they are free to sell their original home for whatever it might get in an as is, where is sale.
Of course the property is officially stuffed, fit only for demo, says Park. But you know the equation. Someone will snap it up for about its land value – around $160,000 – and turn it into cheap rental.
After all, the bungalow is still standing. It’s a substantial dwelling in a great location. So plug the worst cracks to make it water tight and legally habitable and you could let it for maybe $280 or $300 a week…
Thus the idea of Green Belts, the accidental innovation – aimed at adding green space to high-density ancient Vienna in place of the city walls, then adopted in unaltered form in England as an idea to improve urban life for all – has been transmuted into a protective device for the wealthy. If you really want to plan to protect and provide better access to green space and open countryside without artificially constraining land supply and forcing up house prices, then Green Fingers (or Green Wedges) would seem to be the best solution. That is what more egalitarian Scandinavians have. Copenhagen has its Green Fingers – really brown urbanisation along the radial routes out of the city with protected countryside each side. Denmark has not just got cheaper housing: according to the Dallas Fed’s data, the real house price has increased by a factor of 1.6 in Denmark compared to 3.4 in the UK since 1975 but new houses in Denmark are a lot bigger: 80% bigger in fact.
Generation Y is turning its back on cars and jumping on board buses and trains.
The high cost of home ownership, not being in a rush to have children, concerns about climate change, and the difficulty of obtaining a driver’s licence are all reasons behind the shift, according to new research commissioned by the New Zealand Transport Agency.
The study also suggests current assumptions may underestimate the extent to which today’s younger generation has embraced public transport – and how many more would do so if more money was spent on it.
If you’ve ever found yourself stuck in traffic in your metro area, you might want to print out the chart below, tape it to your wall, and use it for dart practice. It comes via a guest post at the Transportationist by Wes Marshall, and it explains so very much of your earthly woe.
The red line represents vehicle flow along a given road. Traffic steadily rises until someone decides the road needs to be widened. Then the original trend line (dotted red) gets replaced with an even greater travel forecast (dotted orange), as we’d expect by creating more road capacity. But the actual new level of travel developed by this widening (solid red) is even greater than the forecast predicted.
In other words, widening a road invites more cars onto it. That principle, known as “induced demand,” is captured by the grey arrows showing the gap between a travel forecast and an actual travel outcome.
RANCHO SANTA FE, CALIF. — Drought or no drought, Steve Yuhas resents the idea that it is somehow shameful to be a water hog. If you can pay for it, he argues, you should get your water.
People “should not be forced to live on property with brown lawns, golf on brown courses or apologize for wanting their gardens to be beautiful,” Yuhas fumed recently on social media. “We pay significant property taxes based on where we live,” he added in an interview. “And, no, we’re not all equal when it comes to water.”
Yuhas lives in the ultra-wealthy enclave of Rancho Santa Fe, a bucolic Southern California hamlet of ranches, gated communities and country clubs that guzzles five times more water per capita than the statewide average. In April, after Gov. Jerry Brown (D) called for a 25 percent reduction in water use, consumption in Rancho Santa Fe went up by 9 percent.
This was my favourite bit:
“I think we’re being overly penalized, and we’re certainly being overly scrutinized by the world,” said Gay Butler, an interior designer out for a trail ride on her show horse, Bear. She said her water bill averages about $800 a month.
“It angers me because people aren’t looking at the overall picture,” Butler said. “What are we supposed to do, just have dirt around our house on four acres?”
Major banks are set to drop deposit thresholds for apartments, making it easier for cash-strapped first-home hunters to get a foot in Auckland’s rampant property market.
The Weekend Herald can reveal that several major banks are reviewing their apartment lending policies, with tentative plans to reduce minimum deposit requirements from 20 to 15 per cent.
The proposal is aimed at owner-occupiers rather than investors. It is being pitched at the first-home-buyer market ahead of changes to Auckland Council’s Unitary Plan that will allow more high-density housing and apartment developments.
The changes are yet to be signed off but could mean someone buying a $500,000 inner-city or city-fringe apartment could potentially secure finance with $75,000 deposit – down from the current $100,000 minimum.
Words and images shape thoughts. But inside and outside of city government, too many of us stumble with finding the right words and images to explain the advantages of biking.
There’s a word for the wave of public misunderstanding and anger that often happens next: bikelash.
Fortunately, bikelash is a curable condition…
And finally, I give you this week’s hilarious economic paper abstract, from Martin Micheli, Jan Rouwendal, and Jasper Dekkers recent paper “Border Effects in House Prices“:
We estimate the effect of the Dutch-German border on house prices… Using different estimation strategies, we find that ask prices of comparable housing drop by about 16% when one crosses the Dutch-German border. Given that price discounts from the last observed asking price are substantially larger in Germany, we interpret our findings as indicating the willingness of Dutch households to pay up to 26% higher house prices to live among the Dutch.
Personally, I would have interpreted it as evidence of cross-border differences in tax, financial, and housing market policies, but I’m informed that the Dutch aren’t too keen on the Germans after a few unpleasant incidents in the first half of the 20th century.
We would like to invite all friends, family and supporters of the TransportBlog to celebrate the launch of our new organisation Greater Auckland. This is happening Sunday, June 21st at 3pm. There will be nibbles and mulled wine provided followed by a few speeches. For more details check out our Facebook event. Stay tuned for more information about Greater Auckland.
In ‘Generation Rent’, the Eaqubs discuss three sets of solutions to help solve our housing problems.
“The first set of solutions – palliative in their nature – will be to provide better and more sustainable living conditions for Generation Rent”, they say.
“The second set will take the heat out of the housing market in the current cycle, by using levers to control demand: raising interest rates, reducing credit availability, creating a more responsive construction sector and perhaps restricting migration and limiting foreign buying.
“But these cyclical measures, though useful, will only buy us time. Throughout the cyclical ups and downs, prices have steadily trended upwards because of underlying policy errors.
“The real fixes, and the hard work, will be in correcting structural problems: slow land supply; expensive infrastructure provision and a broken model for its funding; taxes that favour housing; and policies that encourage banks to lend more for individual property investment.”
But while most people think just about everything else costs more in New York, a recent study by Jessie Handbury of the University of Pennsylvania and David E. Weinstein of Columbia University suggests that groceries and other staples may actually be cheaper in big cities than in small ones—when one does the proper sort of comparison…
Once they adjust for both variety and availability, Handbury and Weisntein find conventional wisdom flipped: People in bigger cities actually pay less, in real dollars, for their groceries. Someone moving from Des Moines to the Big Apple would see a 1.5 percent increase in prices for commonly available groceries. But this higher common goods price index would be offset by the greater number of goods available in New York. As the researchers write, “The gains due to variety mean that the theoretically rigorous exact price index indicates that the price level in New York is actually 4.2 percent lower than Des Moines.”
Clifford Kraus and Nelson Schwartz, “Rick Perry hones his image as ‘Texas miracle’ fades”, NY Times. An interesting look at the state of the Texas economy, which is sometimes cited as a model in the US and other English-speaking countries:
Not long ago, what former Gov. Rick Perry and other conservatives like to call “the Texas Miracle” — the booming Texas economy — looked like a potential steppingstone to national office. But as Mr. Perry jumps into the ever-widening race for the Republican presidential nomination, his state’s economic performance appears considerably less miraculous.
Although Texas’ unemployment rate of 4.2 percent remains well below the national average of 5.4 percent, the state lost 25,000 jobs in March. And while April was better over all, the oil industry in Texas lost an additional 8,300 jobs as plunging oil prices prompted drillers and producers to shut down projects.
“Texas did pretty well, but it’s hard to say how much of that is because of policy choices versus luck,” said Tracy Gordon, senior fellow at the Urban-Brookings Tax Policy Center, a nonpartisan research group in Washington. “We often think of states as playing with the hands they are dealt and making policy choices based on that.”
Labour’s housing spokesman Phil Twyford’s West Auckland electorate office is inundated with similar stories. But in the unregulated market, things are unlikely to improve for renters, he says.
“Homes in the private rental market are in far worse condition than the state housing stock. The rental situation is getting worse. Life is incredibly hard on renters and we don’t have the laws to back them up.”
Housing Minister Nick Smith says the Government “doesn’t accept that renting is as good as it gets for average New Zealand families”, but he confirms he is “considering improvements to tenancy law”.
The Government’s focus remains on getting families in homes, but this is scant relief for the thousands who can’t afford to buy, or who don’t fit the traditional family unit.
Renter Rachel Clark says she is one of many renters who don’t fit a stereotype. “Those who may have wanted to invest their time in travel or more study or creative pursuits rather than a deposit on a house.”
“I don’t think we should be penalised for choosing a different lifestyle to our parent’s generation. Things were easy for them, cheap homes, free education. Times have changed and so should the renting culture.”
Last week Alan Kohler wrote a story for Business Spectator, Australia’s train to nowhere, arguing that the failure of Australian governments to invest in public transport, particularly rail, has favoured house prices near the centre. (1)
Drawing on recent research published by the Reserve Bank (see first exhibit) he says the reason inner-city prices have gone up much faster than the outer suburbs over the last 30 or so years is because a lack of infrastructure spending has made it unviable to live further out.
Australia is a big country; it should have a network of fast and efficient trains linking widespread suburbs, but instead we are crowding into the inner suburbs and paying exorbitant prices so we don’t have to commute more than hour to work each day.
I don’t doubt that the dramatic increase in the value of properties closer to the city centre shown in the first exhibit is the response to increased demand, but I think there are other possible explanations that are more convincing than the historical level of investment in radial rail.
One is that the ratio of dwelling supply to demand has deteriorated much faster in the inner city over the period than it has in the suburbs. That’s in large part because existing residents in established suburbs tend to object to redevelopment…
Opponents of President Obama’s Clean Power Plan (CPP) — the EPA’s proposed rule to reduce carbon emissions from the power sector — tend to discuss it in apocalyptic language, particularly regarding its effects on employment. To pluck an example from a hat: when he was running for Senate last year, Ed Gillespie warned that EPA carbon regulations would destroy “244,000 jobs a year.” (Yes, that is ludicrous.)
So it should set everyone’s mind at ease that, according to a new study, the CPP will yield a small net gain in employment.
Before getting to those details, it’s worth emphasizing a broader point that gets lost in these debates: the net effect of the CPP on employment, like the net effect of past air-pollution regulations, is likely to be small. Performance standards on energy technologies simply do not create or destroy enough jobs to matter much in the larger debate over economic health. Other structural factors, like whether the Fed prematurely raises interest rates, will likely have much more macroeconomic employment effect than EPA’s rule.
New Zealand-specific research has found something similar: putting a price on carbon emissions will do us very little economic harm.
Infometrics says the impact of reducing non-agricultural greenhouse gas emissions to 40% below 1990 levels – the target currently adopted by the EU – would cost just over one-tenth of one percentage point of growth a year between 2021 and 2030, the next so-called “commitment period” for a globally negotiated new pact to tackle climate change.
The Infometrics modelling, which assumes global carbon prices rising to average $50 a tonne, also suggests that there would be little difference between adopting a 40% cut target and a 5% cut…
Looking at national economic output rather that household income, Infometrics projects a 5% greenhouse gas reduction target would reduce gross domestic product by a total of 0.9% over the 10 years between 2021 and 2030, while assuming that the New Zealand economy would grow by an average of 2.1% every year during that period. With a 40% cut, the impact over a decade is modelled at 1.1%.
“John Key says reducing emissions would be ‘disastrous’ for the economy but his own economic modelling shows the impact is marginal,” newly elected Greens co-leader James Shaw said in a statement. “Why wouldn’t we choose an ambitious and fair 40% emissions reduction target when it would still see our economy growing 2.1% annually – the same amount as with a token 5% reduction target – according to the government’s economic analysis?”
Which begs the question: Why the hell aren’t we getting on with it?
Here are five initial takeaways, focusing on areas that seem relevant to the U.S. experience and worthy of more exploration.
1) Managing speeds — and speed differentials — is a top priority
In all three of these countries, the leaders of traffic safety efforts emphasize that managing speed is the number one determinant in their successes in improving safety.
Over the past 15 years, the national governments of Sweden, the Netherlands, and Germany have all proactively and systematically changed their approaches to speed. Each nation (to differing degrees, but all significantly) has lowered speed limits for a clearly defined hierarchy of roads and corresponding speeds. For instance, the Netherlands has shifted…
from 50 kilometers per hour (kph) to 30 kph on smaller, residential streets;
from 70 kph to 50 kph on bigger, or what we’d consider arterial roads; and
from 100 kph to 70 kph on the freeway-like roads outside cities.
In each of the three nations, nearly everyone I’ve spoken with credits speed management as the greatest contributor to their success in improving safety on the streets and saving more lives.
But there’s another important factor: considering and managing for speed differentials. This means a great deal of thought is given to the kinds of users and the mix of users in the specific areas when designs and policies are laid out.
I really notice this when walking or biking around Auckland. Most streets have 50km/hr limits, and street layout – #2 on Shahum’s list – often encourages people to drive faster. It just doesn’t make sense that a high-traffic arterial should have the same speed limit as a high street and a quiet residential street. I don’t see why we insist upon this approach when it’s been proven to be unsafe.
If the international community and their own governments won’t or can’t save them, who will? The answer might be: their cities and citizens. If enough power were devolved to urban areas from corrupt and over-centralised national governments, fragile states might succeed. At least in democracies, the cities have more potential as elected politicians face more pressure to get results than national leaders.
Take Nigeria. It is arguably the worst run of the world’s seven most populous countries. Despite earning hundreds of billions of dollars in oil revenue in the past decade, it will soon have the second-most destitute people in the world after India. Average life expectancy for its 174 million people is 52 years. Transparency International ranks it 144th of 177 countries on the Corruption Perceptions Index. Nigeria has more than 250 different ethnic groups and a history of sectarian strife. It has pirates and armed militant groups fighting the state in its south, sectarian conflict across its ‘middle belt’, and an Islamist insurgency in its north.
But its largest city, Lagos, until recently one of the world’s most difficult to govern, seems to have turned a corner. Although still a slum-ridden and impoverished metropolis, with a population estimated at 21 million, it has seen steady improvement in its governance for over a decade. The government has enhanced public transport, cleaned up streets, upgraded the business environment, and bettered the lives of its inhabitants.
So what has been happening around the city lately?
Some of you may have seen the media items about the first part of the “Uni-Cycle” Major Cycleway on Matai St near Hagley Park getting underway this week (should take until about mid-August to complete). A key part of this work is the signalised crossing of Deans Ave into the Park directly from Matai, replacing decades of going around the long way (or sneaking under the barriers for the direct route). A separated cycleway will also then lead people across to the existing cycleways on the other side of the railway line. While only a short piece of construction, it’s a very important link in our overall network.
Density matters because we’re a social species geared to learn from people around us. We come out of the womb with this remarkable ability to pick up information from our parents, from our peers, from our siblings, even occasionally from our teachers. Cities enable that to happen. It’s remarkable when you think how the cyber seers and techno prophets 30 years ago predicted that all this technology we have would mean the death of distance, the death of face-to-face contact and the death of cities, yet that hasn’t come to pass.
I think they radically underestimated how much richer face-to-face contact is as a means of communication than, you know, Skyping. Skyping is great. I mean, if you’ve got to be on the other side of the world, it’s wonderful to be able to see your children and to say “Hi.” But it’s no comparison with actually being in the same room. And the more important an idea is, the more important it is to communicate it face to face.
I think probably the low-hanging fruit in transportation policy in Milwaukee is the buses. There’s an old line that 40 years of transportation economics at Harvard can be boiled down to four words: “Bus good, train bad.” So it shouldn’t be seen as being an intrinsic problem that you don’t have a train system. Buses are flexible. They’re cost effective. They in principle can be socially programmed… But we tend to see buses as the ugly stepchild of American transportation. That’s really unfortunate.
I (suggest) actually embracing a pro-bus agenda to make buses cool. Spend modest amounts upgrading the buses. You don’t necessarily put in streetcars, just paint your buses to make them look better, figure out how to put in a little more personnel so they feel more safe, figure out if you can do social programming — chat rooms in buses. Run trivia contests for the kids, just purely experimental, low-cost interventions that attempt to make the buses exciting. That’s a cheap public transport agenda that could potentially yield big returns — for a lot less than $5 billion or whatever they are spending on highways. My guess is $5 million would go pretty far with buses.
It’s a sad fact of life for engineers designing cycling infrastructure that the sacred cow of on-street parking frequently frustrates good design. We see vociferous opposition from residents and businesses to the loss of car parking everywhere we turn – from Carlton Gore Rd to Franklin Rd to Westhaven Drive/Beaumont St to of course Queen St in Northcote. For some, the storage of private vehicles, often at no cost, is more important than moving people safely and efficiently along a roadway. We don’t yet live in enlightened times like our European cousins in the Netherlands and Denmark.
So how have AT handled this, particularly when heavyweight politicians like Jonathan Coleman MP and Councillor George Wood sided with the objections of some of the local residents?
Rather well, actually, particularly if your advocacy is tempered with pragmatism and budgeting realities…
By far the mostcommonway to measure transit use is “commute mode share,” or the percentage of workers who use transit to get to their job. For the most part, this is a measure of convenience: it’s the most direct way the Census asks about transportation, which means it’s the easiest way to get consistent data from any city or metropolitan area in the country.
But it also has a lot of problems. For one, the vast majority of trips – about 84% – aren’t simple home-to-work commutes. And it’s not just that people who work also go to the grocery store, restaurants, or friends’ homes. Lots of people don’t work at all, and those people – largely students, the elderly, or people with disabilities – are disproportionately likely to use transit for all or almost all of their trips. Finally, plenty of people who do work might drive three or four days a week and take transit the other one or two. But since the Census only asks about what they do most of the time, they’ll show up as “drivers.” All of these things will tend to undercount a place’s reliance on public transit.
City Observatory would like to offer our own measures of transit use, based on data from the Census’ American Housing Survey. (The 2013 AHS includes just 25 metropolitan areas, which is why many larger cities are left out of our list below.) And these measures suggest that, indeed, commuting mode share dramatically understates Americans’ reliance on transit.
It may be a reflection of just how quickly the Government’s recently announced plans to free up some 500 acres of land for housing in and around Auckland were developed, but it looks like no-one stopped to ask themselves “can we actually do this?” before embarking on the exercise.
Because, as is now belatedly becoming obvious, there’s as pretty big tangata whenua shaped elephant standing in the Government’s path in the form of the Ngā Mana Whenua o Tāmaki Makaurau Collective Redress Act 2014.
This legislation gives force to a collective settlement reached between the Crown and a bunch of iwi and hapū that have overlapping Treaty claims in the Auckland region…
Under the Government’s current proposal, they want developers to build houses on its land, with title then being transferred once the development is completed. But how’s that going to work if, once the development is done, the body representing the various iwi and hapū then gets a peremptory right to purchase the land in question? What sort of developer is going to enter into the house building game under that cloud of uncertainty?
When the Ngā Mana Whenua o Tāmaki Makaurau Collective Redress Deed was signed back in 2012, it contained a “Property Redress Schedule” (you can see it in PDF here, from p.21 on). And that Schedule contained a specific “Department of Building and Housing Protocol”, which is at p.46 of that document.
Under that Protocol, the Crown agreed that:
If the Crown intends to:
7.1.1 develop land it owns that is subject to the [right of first refusal] RFR to achieve, or assist in achieving, the Crown’s social objectives in relation to housing or services related to housing; and
7.1.2 involve a party other than the Crown (including a private buyer or Crown body) in that development,
the Department [of Building and Housing] shall first provide the [iwi and hapū’s] limited partnership the opportunity to be the developer, subject to meeting the intended Crown social objectives in relation to housing or services related to housing, and on such terms as might be offered to the private sector.
Which the Department just hasn’t done. So, on the face of it, the Government’s announced plans are a breach of the agreement it made in its settlement deed with the Tāmaki Makaurau Collective only three years ago…
Indonesia’s capital Jakarta has the world’s worst traffic jams according to a new survey by Castrol, its 2014 Magnatec Stop-Start Index. Have sympathy for the city’s drivers, who were recorded as suffering 33,240 stop-starts per year, meaning they spent 27.22% of their total travel time going nowehere.
The index uses data shared anonymously by millions of TomTom navigation users around the world and covers 78 countries. The next worst city was Istanbul, with drivers spending nearly 29% of their travel time stationary.
Europe contains 8 of the 10 cities with the lowest number of stops-starts, the winner being Tampere, Finland:
1. Tampere, Finland (6,240 stops-stars per car per year)
2. Rotterdam, The Netherlands (6,360)
3-4. Abu Dhabi, United Arab Emirates (6,840)
3-4. Bratislava, Slovakia (6,840)
5. Brisbane, Australia (6,960)
6. Antwerp, Belgium (7,080)
7. Porto, Portugal (7,200)
8. Brno, Czech Republic (7,320)
9. Copenhagen, Denmark (7,440)
10. Kosice, Slovakia (7,440)
Worldwide, over $100 trillion in public and private spending could be saved between now and 2050 if the world were to expand public transportation, walking and bicycling in cities, according to a report by the Institute for Transportation and Development Policy and the University of California, Davis. Additionally, reductions in carbon dioxide emissions reaching 1,700 megatons per year in 2050 could be achieved.
Cities lose people because of two processes, which often happen at the same time. The first is migration—whether from a city in one country to a city in another, from city to city within a country, or from city to suburb. The cause is often industrial decline. Khulna, a city of more than 1m in Bangladesh, has contracted along with its jute industry. Middlesbrough, in England, has not recovered from the loss of shipbuilding. In many cases, workers do not move far. Detroit is surrounded by successful suburban cities; the overall population of the metropolis has changed little over the past few decades. Seoul has probably lost people to the burgeoning aerotropolis of Incheon, 30 miles (48km) away.
The second cause is demographic change. Though increased life expectancy can delay the moment of reckoning, once a country is largely urbanised, its cities will contract unless it can attract enough immigrants or deliver enough babies to counterbalance the number of deaths. Japan and Russia are already failing to do this, and South Korea is approaching the edge. Japanese women have 1.4 children each, on average; though South Korea’s population is younger, its women have just 1.2. Neither country wants mass immigration. Successful cities in such countries will be able to grow by poaching inhabitants from unsuccessful ones. But as the total population falls it will become clear that they are playing a national game of demographic musical chairs, competing for an ever-shrinking number of people. China will soon be doing this, too: the UN reckons its urban population will be declining by 2050.
Two public opinion polls came out in the last month suggesting the kinds of places Millennials like. Spoiler alert: it’s Boston, New York, San Francisco, and Chicago, as well as communities such as—I’m inclined to say once again, of course—Boulder and Austin. The key characteristics seem to be walkability, good schools and parks, and the availability of multiple transportation options.
They found that 54 percent of Millennials surveyed would consider moving to another city if it had more or better options for getting around, and 66 percent said access to high quality transportation is one of the top three criteria they would weigh when deciding where to live.
The second survey was released last week by the American Planning Association, on the last day of the organization’s National Planning Conference in Atlanta, a gathering of some five thousand planners, elected officials and others. The report on the national poll, titled Investing in Place, compiled results of surveys of 1,040 Americans, roughly half Millennials, the other half baby boomers. Part of the message was that the two groups want many of the same things: better transportation options, walkable communities, technology-enabled cities, and housing that would allow “aging in place.”
I must point out the inherent stupidity of many North American urban centers, the schizophrenic nature of public policy on urban developments.
On one hand, you have DOTs and Transport Ministries that seek to enable fast, uncongested travel in metropolitan areas. They will build new roads and widen existing ones to make sure that people can keep traveling around quickly, increasing mobility. They will do so with tax money and not with fees, because the unspoken idea in North America is that people are entitled to highways, to fast roads to get them where they want to go, and all of that without having to pay for it directly. Try denying someone highways or asking highways to be tolled and they will cry out that they are being treated as “second class citizens” (I know, one of my old friends used that line on me when I told him I opposed highway construction to the suburb he recently moved in).
On the other, you have State/provincial governments or city governments adopting green belt regulations to restrict sprawl and prevent it.
Do you see the problem? We are creating sprawl with our transport policy and investments, with public money, but then we turn around and say “sprawl is bad” and try to limit it. We are doing one thing and its opposite, spending a lot of money on both, not realizing that we are largely fighting against ourselves and wasting billions of dollars doing it! Using regulation to fight something that we created by other regulations and government intervention.
So urban growth boundaries are a bad reaction to a problem that we create with our choices of transport policy and investments. We don’t need them, what we need is to stop treating access to high-speed, toll-free roads as a human right and stop spending so much tax money on it. Make highway users bear the cost of highway construction and maintenance through tolls, impose congestion charges on vehicles accessing congested areas and do not build roads if they wouldn’t be profitable, and you won’t need urban growth boundaries as it will create incentives to avoid traveling high distances regularly. Of course, we also need to accept the fact that infill developments need to happen and that areas need to be able to change to accommodate higher demand.
Ultimately, yes, the result is higher housing costs per square foot. However, the cheap housing prices of sprawl is largely illusory, the result of hidden costs through higher transport costs for residents and higher infrastructure costs for governments. People should be free to live in the middle of nowhere if they want, to benefit from low land costs to have a big house, I am fine with that… as long as they don’t ask the rest of society to pick up the tab and build the infrastructure required to allow them to live in that way without all the inconveniences of distance.
Consider the problem of replication. One of the principles of the scientific method is that researchers should attempt to validate previous findings by replicating their experiments. This was how LaCour’s fraud was uncovered: another researcher, David Broockman, tried to repeat his study and found he couldn’t.
The problem, though, is that this kind of work is extremely rare.“The vast majority of scientific articles never get built upon at all,” explained Harvard’s Sheila Jasanoff, a critical theorist on science. Researchers are often discouraged from replicating the work of others — because it’s not considered as important or worthy as discovering new things.
This problem isn’t new; scientists have been talking about it for decades. For this reason, it’s now common to hear statements like this one from The Lanceteditor Richard Horton: “Much of the scientific literature, perhaps half, may simply be untrue. Afflicted by studies with small sample sizes, tiny effects, invalid exploratory analyses, and flagrant conflicts of interest, together with an obsession for pursuing fashionable trends of dubious importance, science has taken a turn towards darkness.”
How can one report filed with the NSW Major Project register predict 20,000 fewer cars per day on a section of Parramatta Road, while other reports within the Roads and Maritime Services state that no significant reductions are likely to be seen?
It is very easy to chalk up some of these differences either to wildly overoptimistic developers potentially misleading themselves and others to get a project approved. Similarly, it is sometimes alleged that feasibility studies might be influenced by political biases or pre-established views on the merits of roads or public transport schemes.
While these factors may well influence some decision making, one thing that is often missed in the reporting of such studies is the sheer complexity associated with analysing such networks. Assuming all roads are connected, the behaviour of a whole network can be hyper-sensitive to how individual parts, even seemingly minor ones, function.
A poor estimate of traffic flow in one section of a network can lead to hugely different behaviour across the whole system. Furthermore, even the simplest networks can have the potential to function in some extremely surprising and often counter-intuitive ways.
It is very easy to believe that if a traveller is offered the choice of two routes for a journey that the addition of a third choice should not worsen his/her travel time. If the new route is slower, the traveller could simply ignore the new route and make the same choice as before.
As the German mathematician Dietrich Braess pointed out, this is not always the case. Increasing the capacity of a network can, perhaps surprisingly, decrease the efficiency of journeys around it even without increasing the number of trips made, as was pointed out in a recent article…
This paradox is not simply a mathematical quirk or one which can be neglected by network analysts. There are a number of examples where removing roads – rather than building news ones – has improved transport networks.
Probably the most famous example of this comes from South Korea. When the motorway network around Seoul was reworked to remove some of the 1960s-built roadways, the the result was significantly reduced transit times throughout the city. This was not because of fewer journeys through the city, rather a more efficient distribution of cars across the remaining network.
Similar phenomena have been observed during road closures in New York City in the United States and in Stuttgart in Germany.
IN MEDICINE, trials are conducted on guinea pigs, rats, mice and rabbits. In digital businesses, tests are performed on New Zealanders. Their country is proving the perfect location for software firms, social networks and app developers discreetly to try out and refine their products…
New Zealand’s relative isolation means that if a product needs to be modified significantly to fix faults or make it more appealing to consumers, word of its teething troubles is less likely to spread, thereby discouraging customers elsewhere from trying the improved version. If a firm finds that a particular product, or a new feature added to an existing one, is a resounding flop in New Zealand, it can quietly be dropped without having much effect on the company’s overall reputation.
Cycling along the cut was always a joy. The path was not smooth; its rough surface allowed us to jump and practice our wheelies. It did, however, have its dangers. The overgrown brambles narrowed the path and the thought of ending up in the cut was not a pleasant one. Water quality was not something we thought of in those days, but we did worry that lurking in those murky depths lay piscine danger – a giant pike, known as Big Bess, that had snapped many an angler’s line hunted here. And, more improbably, the story that a unscrupulous pet shop owner had discarded his stock of piranha in the canal was doing the rounds at school
We rode and we rode. We rode so far the accents along the tow path changed again and again. We called out “Any luck?” to those fishing on the banks, and bartered with bargies – we would open the locks for them in exchange for our shandy money.
A bicycle was our passport to the wider world and we loved the freedom it gave us.
So why did cities help build the expressways that would so profoundly decimate them? The answer involves a mix of self-interested industry groups, design choices made by people far away, a lack of municipal foresight, and outright institutional racism.
“There was an immense amount of funding that would go to local governments for building freeways, but they had little to no influence over where they’d go,” says Joseph DiMento, a law professor who co-wrote Changing Lanes: Visions and Histories of Urban Freeways. “There was also a racially motivated desire to eliminate what people called ‘urban blight.’ The funds were seen as a way to fix the urban core by replacing blight with freeways.”
This is also notable, and likely to apply to New Zealand as well:
Even though gas taxes have never fully paid for highways — a recent Public Interest Research Group report found they’ve covered between 43 and 74 percent of costs through the interstate system’s history — the widespread perception that highways and freeways are somehow self-funding has stuck around.
The Dutch experience is far removed from New Zealand. Historically, in the Netherlands most land was owned, developed and sold by national or local governments. Housing was developed at scale by private developers and few people were able to build an individual house. Housing was however, generally of a high standard and affordable. Over the last 20 years, the Dutch have introduced a greater flexibility and individual focus to the housing industry that is more relevant to the current context of New Zealand. While introducing market-led reforms, they have retained the benefits associated with building at scale, articulating a clear vision and involving all affected parties. In short, the Dutch plan – in the original sense of the word; opportunities in greenfield and brownfield sites are identified, development options are tested and the affected community is involved early in the process. Rather than lobbing grenades from the sidelines, all parties have a seat at the table. It is a process that invites certainty for communities, developers and the financial institutions involved. Public Private Partnerships are the norm. Over the years this approach has produced a number of interestingly diverse examples. Those that follow include the exciting and well-known as well as projects destined to be comfortable places in which to raise a family, rather than grab the spotlight…
Funen, Amsterdam, a development that combines living and working in high city-centre densities with sufficient green space on ‘Het Funen’, a former industrial zone on the edge of Amsterdam’s city centre. It is a concept that incorporates the qualities of diverse typologies: the construction of perimeter blocks along two sides, with a novel interpretation of the ‘garden city’ model to their rear.
At a different scale altogether, ‘Het Funen’ – or Hidden Delights – consists of 500 dwellings set in open space on what was a former parking lot for towed cars in east Amsterdam. A masterplan by Frits van Dongen established a perimeter block around the right angle of a difficult corner site that acts as a barrier to the busy railway line adjacent. A loose grid of 16 housing blocks is laid out within the triangle with a diversity of typologies: live-work units, maisonettes, penthouses, seniors housing, studios and houses specifically design for the disabled. There is a mix of individually owned and rental accommodation. The ground floor of the perimeter block contains commercial space. In this instance a single company – IBC Vastgoed – undertook the entire development. Usually it would be instigated by the city.
These protected views help to explain why tall buildings are rising in such a dispersed pattern. The Shard will not get neighbours anytime soon, as it is wedged between two viewing corridors. In the City, towers are scattered instead of crowding around transport hubs, as economic theory might predict. Their odd designs—described by nicknames such as the Gherkin, the Walkie Talkie and the Cheesegrater—are in some cases a means of avoiding imposing on St Paul’s. Only at Canary Wharf, which is too far east to spoil many views, do cuboid skyscrapers rub together in the way they do in other big cities.
The other reason London’s tall buildings are so oddly spread is local democracy. In the conservative borough of Westminster, the council resists almost all new tall buildings; despite soaring rents, no new skyscrapers have been built there since the 1960s. In the corporatist City, expensive architecture is prized. Almost anything goes in poor Labour-run authorities such as Lambeth, Southwark and Tower Hamlets.
Speaking of efficiency, common sense says that when drivers are humming along at or even above the speed limit, highways are performing at their best. The German autobahn, with its (shrinking) speed-limit-free zones, is often offered as a shining example. It must be those slower drivers who are holding things up!
But as good as fast-moving roads might be for the individual driver, they are not the best for the most drivers. As data gleaned from in-pavement “loop detectors” on Washington state highways showed, those highways were able to achieve “maximum throughput” — pushing the most cars through one segment of road in a given time — at speeds that were roughly 80 percent of the posted speed limit of 60 mph. Why? At higher speeds, drivers need to allow more “headway” between vehicles, meaning more space is required per vehicle. And faster-moving traffic tends to break down more quickly, with more severe “shock waves”; it takes a lot longer to recover from a traffic jam than to get into one. I have been told, anecdotally, by traffic engineers that the left-hand “passing lane” can become congested first. (I’ll leave it to you to decide if karmic justice is at work there.)
Renewable prices are not static, and generally head only in one direction: Down. Cost reductions are driven primarily by the learning curve. Solar and wind power prices improve reasonably predictably following a power law. Every doubling of cumulative solar production drives module prices down by 20%. Similar phenomena are observed in numerous manufactured goods and industrial activities, dating back to the Ford Model T. Subsidies are a clumsy policy (I’d prefer a tax on carbon) but they’ve scaled deployment, which in turn has dropped present and future costs.
[W]hen it comes to things that make urban life better or worse, there is absolutely no reason to have faith in the invisible hand of the market. External economies are everywhere in an urban environment. After all, external economies — the perceived payoff to being near other people engaged in activities that generate positive spillovers — is the reason cities exist in the first place. And this in turn means that market values can very easily produce destructive incentives. When, say, a bank branch takes over the space formerly occupied by a beloved neighborhood shop, everyone may be maximizing returns, yet the disappearance of that shop may lead to a decline in foot traffic, contribute to the exodus of a few families and their replacement by young bankers who are never home, and so on in a way that reduces the whole neighborhood’s attractiveness.
On the other hand, however, an influx of well-paid yuppies can help support the essential infrastructure of hipster coffee shops (you can never have too many hipster coffee shops), ethnic restaurants, and dry cleaners, and help make the neighborhood better for everyone.
In sum, almost every major city and tourism centre in New Zealand is – simultaneously – building or extending convention centres, and is taking significant risks and investments in public money ( and public land) in the process. All these complexes are targeting much the same basic audience : the domestic and international conference markets. The economic rationale for these projects is based on the spending that the centres are being hoped to generate from (a) the hotels that will accommodate the delegates (b) the bars and restaurants that will serve them and (c) the retail outlets in which they will spend a remainder of their money.
To date, there has little or no analysis of what the net national benefit would be – if any – to New Zealand from these ventures. Constantly, the facilities will be competing with centres offshore for hosting rights to a limited number of major international conferences. Domestically, one region’s gain will be another region’s loss.
Since I moved to Auckland, I’ve been trying to make sense of local trends in house prices. Why have they risen over the last decade? Will they keep going up, or crash back down to earth? What’s driving all this?
Others are more confident that planning was what done it. For example, the annual Demographia Housing Affordability Survey states, quite confidently, that planning regulations – an “institutional failure at the local level” – are the main cause of high house prices:
The purpose of the Demographia Surveys is to alert the public and policy-makers if housing exceeds 3.0 times annual household incomes, that there is institutional failure at the local level. The political and regulatory impediments with respect to land supply and infrastructure provision must be dealt with.
Former Reserve Bank governor (and former leader of both National and ACT) Don Brash made matters even clearer in his foreword to the 2008 edition:
The affordability of housing is overwhelmingly a function of just one thing, the extent to which governments place artificial restrictions on the supply of residential land.
In short, planning rules – especially metropolitan urban limits – are bad. Very bad. They are the main reason that houses in some places are unaffordable, which Demographia defines, somewhat arbitrarily, as median house prices that are more than three times the median household income:
Now, according to Demographia, Auckland currently has a “median multiple” of 8.2: “severely unaffordable”. Based on their figures, the median house price in the city at the end of 2014 was $613,000. (This actually seems low – perhaps they’ve converted it to USD?)
In order for Auckland to meet Demographia’s definition of an “affordable” market, house prices would have to fall by $390,000, or 63%. Given that they think that urban planning/metropolitan urban limit policy is the main cause of high house prices, we can take this as their estimate of the cost of those policies. $390,000, per house.
This is obviously a very large number. If house prices fell back to the “affordable” level, it would have ruinous effects on NZ’s financial system and household wealth. (Frankly, this does not seem like a very good outcome.)
So that’s Demographia’s estimate. Recently, several New Zealand economists have taken a more detailed look at the costs of planning regulations in Auckland. For the most part, they analyse the impact of planning rules that were put in place by previous councils:
Motu’s paper on the costs of planning regulations concludes that they add between $32,500-$60,000 to the cost of a new standalone house and $65,000-$110,000 to the cost of a new apartment. These figures were sourced from a survey of developers and accounted for the impact of a number of individual rules ranging from balcony rules to section size controls.
NZIER’s paper models the impact of urban limits and height/density limits. (This paper uses a similar approach to the one I discussed here.) It concludes that these two rules cost households the equivalent of $1800 per annum. In present value terms, this is somewhere on the order of $30-40,000 per household (depending upon what discount rate you use).
[Disclaimer: I know the authors of both studies and have a great deal of respect for their work. In a professional capacity, I provided comments on earlier drafts of both papers. This is somewhat unavoidable given the size of New Zealand…]
Here’s a chart comparing Motu and NZIER’s estimates of the cost of planning regulations with Demographia’s estimate:
In other words, these estimates suggest that Auckland’s planning regulations explain only 10-30% of the difference between Auckland house prices and a median multiple of 3. Even if we add together the estimates from the two papers, we don’t get anywhere near explaining the gap.
So: whose estimates of the cost of planning should we believe?
Personally, I trust Motu and NZIER’s analysis, as it’s backed up by empirical research and/or economic modelling, whereas Demographia’s is mainly justified by rather repetitive and self-referential haranguing. Consequently, I don’t think we can conclude that planning regulations are a sufficient explanation for Auckland’s relatively high house prices.
That doesn’t necessarily mean that we should be sanguine about planning regulations. While things will change under the Unitary Plan, the costs associated with existing rules are reasonably large. And, in contradiction to Demographia’s claims that constraints on greenfield land supply are the biggest problem, both papers find that existing regulations place higher costs on higher-density developments.
The Motu paper finds that existing planning rules add twice as much cost to apartment developments as to standalone houses. Similarly, the NZIER paper finds that height limits (and other controls on density) are slightly more costly than urban limits. (This is partly because Auckland is mostly surrounded by water, meaning that preventing land from being used efficiently is much more deleterious than it would be in a city with more land.)
This is a story of conflict and how a small but heavily fortified opposition attempted to block a project that has overwhelming public and institutional support. But if SkyPath is granted its resource consent and any subsequent appeals to the Environment Court are dismissed, the story is likely to be framed differently. It will be about a humble accountant who fought to bring the project to life, despite tremendous institutional opposition and public apathy.
Bevan Woodward estimates he now spends six to nine hours each day working on SkyPath, and that for long periods over the past 10 years he worked even harder, until he realised he was burning himself out.
For many years, almost nobody supported it: not NZTA, not Auckland Transport, not Waterfront Auckland. SkyPath had supporters at Auckland Council, but few other people in power were prepared to help it succeed.
He’s an unlikely champion for a project that almost everyone now wants. He seems surprised by it himself. “I’m a former accountant. I was a business owner in Takapuna, I now live up in Warkworth for family reasons and once a week I carpool down to Auckland, go to my meetings. I’m not being paid to do this. Why is it that one of the most important transport projects has to be run by some unpaid members of the community?”
In 2009, before 5000 Aucklanders pushed through police lines, crossing the bridge on foot and on bike to demonstrate their support, he was ready to quit. He still talks about that event with reverence, as if its memory still sustains him.
The statistical analysis of of 20 industrial countries including New Zealand since 1970 has found that housing booms and busts are lasting longer and when governments take a “wait and see” approach to those cycles, they can spiral out of control.
The longer the booms like the one Auckland is experiencing last, the less likely it is that intervention will be effective…
The paper, Booms, Busts, and Normal Times in the Housing Market by the American Statistical Association appeared in the Journal of Business and Economic Statistics and was publicised this month.
The paper’s authors say their findings support preventive policy interventions by governments during boom times and emphasise the need for timeliness.
A counter-cyclical policy was needed before housing booms and busts reached 26 quarters in order to avoid large and persistent housing price swings and to speed up the return of the market cycle to a normal phase.
New Zealand Institute of Economic Research principal economist Shamubeel Eaqub said the typical cycle (bottom to top) in New Zealand had gone from about three years in the 1970s to six years in the 2000s boom. The current boom had been running four years “and counting”.
“The international evidence in (this) paper suggests that action should be taken within the first six or seven years of the boom. We are in that phase now where co-ordinated action by policy makers is necessary to avoid the costs of sharply accelerating house prices and the risks of a potential future downturn,” Eaqub said.
Riffing off of the University of Toronto’s Roger L. Martin, the history of globalization can be understood as the international trade of different forms of capital. For Globalization I, the world exchanged physical capital (i.e. manufactured goods). The epicenter of this economic epoch was Detroit. United States President Ronald Reagan unleashed Globalization II, the era of financial capital. The twin towers, New York City and London (NYLON), ruled the flows of money across sovereign borders. The time of Globalization III is nigh. Human capital lords over physical and financial capital, setting up Boston as the Venice of the current age.
Echoing Martin once again, the highest return on the type of capital defines globalization. If physical capital offers the strongest returns on investment, then Globalization I rules. Welcome to Globalization II if finance provides the best way to get rich. Lastly, acknowledge Globalization III when higher education defines economic geography. Instead of goods or cash, where the brains go matters most.
We study how growth of cities determines the growth of nations. Using a spatial equilibrium model and data on 220 US metropolitan areas from 1964 to 2009, we first estimate the contribution of each U.S. city to national GDP growth. We show that the contribution of a city to aggregate growth can differ significantly from what one might naively infer from the growth of the city’s GDP. Despite some of the strongest rate of local growth, New York, San Francisco and San Jose were only responsible for a small fraction of U.S. growth in this period. By contrast, almost half of aggregate US growth was driven by growth of cities in the South. We then provide a normative analysis of potential growth. We show that the dispersion of the conditional average nominal wage across US cities doubled, indicating that worker productivity is increasingly different across cities. We calculate that this increased wage dispersion lowered aggregate U.S. GDP by 13.5%. Most of the loss was likely caused by increased constraints to housing supply in high productivity cities like New York, San Francisco and San Jose. Lowering regulatory constraints in these cities to the level of the median city would expand their work force and increase U.S. GDP by 9.5%. We conclude that the aggregate gains in output and welfare from spatial reallocation of labor are likely to be substantial in the U.S., and that a major impediment to a more efficient spatial allocation of labor are housing supply constraints. These constraints limit the number of US workers who have access to the most productive of American cities. In general equilibrium, this lowers income and welfare of all US workers.
Research led by the University of East Anglia in the UK had 4,000 participants describe their main mode of transport for their daily commute and provide details of their height and weight, which was used to calculate their body mass index (BMI).
Researchers then used a series of analyses to see if changes in mode of transport were linked to changes in weight over a two-year period.
Switching from a car to walking, cycling, or using public transport was associated with an average reduction in BMI of 0.32kg/m2 – equivalent to a difference of around one kilogram a person.
The longer the commute, the stronger the association, with a weight loss of around 2kg associated with journeys of more than 10 minutes, and 7kg on average for journeys of more than 30 minutes.
Switching to a car was associated with a significant weight gain of around 1kg per person after taking account of other influential factors.
You would think that would make a city, especially one as well-managed and prudent as Lafayette, incredibly conservative when it comes to taking on long-term commitments. In reality, we see the opposite, not just in Lafayette but in nearly every city across the country. Local governments face enormous incentives to pursue near term growth objectives by taking on onerous long term liabilities. We’ve called it a Ponzi scheme because, despite the lack of a nefarious objective, the mechanism is the same. Cash today with the bill coming due sometime in the future…
The median house in Lafayette costs roughly $150,000. A family living in this house would pay about $1,500 per year in taxes to the local government (more to the schools and regional government) of which 10%, approximately $150, goes to maintenance of infrastructure. A fraction of that $150 – it varies by year – is spent on actual pavement.
To maintain just the roads and drainage systems that have already been built, the family in that median house would need to have their taxes increase by $3,300 per year. That assumes no new roads are built and existing roadways are not widened or substantively improved. That is $3,300 in additional local taxes just to tread water.
That does not include underground utilities – sewer and water – or major facilities such as treatment plants, water towers and public buildings. Using ratios we’ve experienced from other communities, it is likely that the total infrastructure revenue gap for that median home is closer to $8,000 per year.
The Traditional Euro-bloc (what I at first called the traditional European urban bloc) is a form of development that is present in almost all European cities and typically forms their densest residential and mixed up sections.
Here is a typical example, in Prague:
A more recent Traditional Euro-bloc in Prague
So, what is the Traditional Euro-bloc? It takes the form of buildings built wall-to-wall, lining the street, that are typically mid-rise (usually 4 to 6 stories high, sometimes a bit more or less). They have little to no front setback, providing for a great sense of enclosure (maybe even more than most North Americans would like) but having the possibility of creating a cold, claustrophobic street scene if without commercial activity and with street parking. Since buildings are built at the property line, it creates an empty space inside the bloc, that space can be used in many different ways: a shared courtyard, parking, a park, playing fields, etc…
So, to come back to the idea of urbanism focused on form or on process, focusing on the form of these Euro-blocs rather than the process through which they were built is, in my view, a mistake. They have emerged largely organically through incremental development, responding to economic signals and community needs, trying to replace that by a planner’s dictates seems like a bad idea to me. But that’s what happens when people want harmony and are ready to leapfrog stages of development heedless of economic realities to get it. Not that it cannot work, but it can also fail by making it so expensive and difficult to do that developers will pass on that opportunity and prefer to work in suburbs where regulations are less restrictive.
Can we build this today too?
Actually, the exact form of these Euro-blocs would probably be illegal, and adapting them to fulfill the legal obligations would make them much more expensive…
Try buying some land. You will rapidly discover that the land market has some very odd features. First, it’s extremely hard to find out what bits of land might be for sale. Landowners sometimes advertise a site for sale, in trade magazines most of us have never heard of, but this is very much the exception. Most sites are bought by a developer or agent approaching the owner directly to suggest a possible sale.
Second, it’s often very tricky to find out who the owner is. The ownership of most land is recorded at the Land Registry and can in theory be looked up – but it’s not an easy process, and you need to know what you’re doing. Half the time it turns out that the registered owner is a company name, often registered overseas, so you may never be able to track down someone who could discuss selling the site.
The next barrier is simply that most landowners have no intention of selling their land, at least not unless you offer them a very high price. After all, they’ve stopped making it. Many landowners turn out to have no interest in building: 50% of land with planning permission in London is owned by non-developers.
What we have, uniquely in America, is a political class, and an entire political party, devoted to the idea that any money spent on public goods is money misplaced, not because the state goods might not be good but because they would distract us from the larger principle that no ultimate good can be found in the state. Ride a fast train to Washington today and you’ll start thinking about national health insurance tomorrow.
…the prejudice against trains is not a prejudice against an élite but against a commonality. The late Tony Judt, who was hardly anyone’s idea of a leftist softy, devoted much of his last, heroic work, written in conditions of near-impossible personal suffering, to the subject of … trains: trains as symbols of the public good, trains as a triumph of the liberal imagination, trains as the “symbol and symptom of modernity,” and modernity at its best. “The railways were the necessary and natural accompaniment to the emergence of civil society,” he wrote. “They are a collective project for individual benefit … something that the market cannot accomplish, except, on its own account of itself, by happy inadvertence. … If we lose the railways we shall not just have lost a valuable practical asset. We shall have acknowledged that we have forgotten how to live collectively.”
Trains take us places together. (You can read good books on them, too.) Every time you ride one, you look outside, and you look inside, and you can’t help but think about the private and the public in a new way. As Judt wrote, the railroad represents neither the fearsome state nor the free individual. A train is a small society, headed somewhere more or less on time, more or less together, more or less sharing the same window, with a common view and a singular destination.
As I’ve written before, car parking doesn’t come cheap for apartments and terraces. Typically, car parks in a basement or building will cost around $30,000 to $50,000 each to provide. This can make a big difference to the overall cost of an apartment, something often overlooked in the debate about affordable housing.
For this reason and many others, we’ve consistently advocated for the removal of parking minimums. That’s the preferred policy approach. We also push for more frequent, more reliable, and more connected public and active transport options, so people have choices besides driving.
However, the private sector has a role to play too. Most of the developments we’re tracking around Auckland have one or two carparks bundled with each apartment. The cost of that park is factored into the overall sale price. What we’d like to see is more developments “unbundling” their carparks, selling them separately to the apartments. Buyers will still be able to purchase them, but if the $40,000 price tag makes them reevaluate how much they need a carpark, they won’t have to (what are you doing parking your $5,000 car in a $40,000 carpark anyway?). As a result, the developer gets a better gauge of the demand for carparks – one which matches the demand to the actual cost of providing them – and can potentially build fewer of them.
Photo: Patrick Reynolds. The Merchant Quarter Condominiums are one of only a few developments outside the city centre to have unbundled carparks (although it is actually built above a public parking building)
We expect to see a lot more bike racks in new developments – these are often mandatory anyway – and we’re starting to see some encouraging signs that developers are innovating and coming up with new ideas for helping apartment residents get around the city.
Free Primavera 50 Vespa motor scooters and helmets are being given away with six “affordable” Mt Eden one-bedroom apartments, for sale from $430,000.
Greg Reidy, managing director of developer McDougall Reidy, said the scooter and helmet idea was for buyers of the smaller places in his Botanica Living scheme because they have no carparks.
Although the new apartment block will rise near the Mt Eden Train Station, Reidy said the Vespa idea was an attempt to resolve transport and commuting issues for buyers.
“They cost about $6000 each. We thought it was an option for people to get around the city without using a car. I think it’s a good solution. You see it all around the world, in places like Rome, people buzzing around on those,” Reidy said.
Two free electric cars come with another big apartment scheme where residents will each be issued with keys and must then decide who gets to use the cars and when.
Mark Todd of developers Ockham Residential described the electric car scheme for a high-profile block planned on Akepiro St, Mt Eden.
“We will be building 33 apartments this coming spring with just two communal electric cars. There will also be cycle and motorcycle parking”.
OK, so most Botanica apartments still come bundled with carparks, but so do almost all the others in Auckland, especially outside the city centre. Scooters are a good option for people who still need to drive occasionally (and who’d only be taking up one seat in a five seat car anyway…), so this is an innovative idea from the developer. Scooters are cheap, fuel efficient, and take up a lot less space in the basement than cars, so the parks cost a lot less to provide.
As for Akepiro St, which I’m told will be called the Daisy apartments, this is pioneering stuff for New Zealand in many ways – transport is just one of them. Based on the article, it seems they’ve gone from 25 to 33 apartments since the design competition for the building finished, and from 11 to 2 carparks, both of which are communal. It’s a well connected site, close to both train and bus routes, and pretty central for people who want to use active modes. I’m sure there’ll be a number of companies keen to give Ockham a good deal on the electric cars, too.
The goal of abundant access has several kinds of appeal.
First, it can be measured objectively without recourse to psychology or culture. Ridership estimates are based heavily on travel times that approximate the notion of abundant access, but they also add psychological factors that are less stable, such as observed preferences for particular technologies. These factors may be emotionally vivid, but like many emotional factors they are likely to change with time and especially with generations — just as emotional attitudes toward cars are changing now. Abundance access measures a fact that is entirely objective — travel times. Unlike emotional reactions to technologies, the value of access has been constant across millennia of human experience.
Second, abundance of access is literally a quantification of freedom, in the sense that matters to us in transportation. Isochrone maps like Mapnificent’s, in particular, show us our freedom in a very immediate way: here is where you are free to go, now. Abundant access measures the transportation element of opportunity of all kinds, which is one of the main reasons people have moved to cities since their invention.
The concept of freedom is sadly undervalued in much urbanist discourse, and I am always looking for ways to reintroduce it. Much urbanist writing, for example, is blatantly prescriptive (“you should want this kind of community”), which feeds conservative stereotypes of urbanism as manipulative or coercive. We need to be able to talk not just about ideal communities but about freedom and personal responsibility, a frame in which all the great urbanist ideas — and all the urgent environmental imperatives — can be stated equally well. In that frame, the key idea is not “the good” but “choice,” where freedom of choices also implies responsiblity for your choices.
An individual cycle-path is only as useful as the rest of the grid of routes to which it connects. Even exceptional pieces of bicycle infrastructure are almost entirely useless on their own. They only reach their potential when they are part of a very finely spaced grid of routes which connects to all destinations. To be suitable for all people, this must provide a high quality level of service to all of those destinations. The average quality of service experienced by cyclists dictates how many people will cycle.
Example of a real, successful, cycling grid
Primary (red) and secondary (blue) bicycle routes in Assen. Grey lines are mainly residential streets almost completely free of motor traffic, green are recreational routes. Primary routes are never more than 750 m apart, but note that all the space between them is also available by bike. There are no real gaps in this grid and it leads right from villages outside the city to the city centre. Total map width approximately 6.5 km.
By the end of the week rental property investors were sitting pretty at the fireside.
They would have smiled on Monday when Mr Key downplayed again the prospect of any Australian-style restrictions on foreign buyers or any Victoria-style taxes on foreign buyers.
They would have grinned from ear to ear as the Governments responsible for encouraging new house building squabbled on Tuesday over how to pay for pipes and roads while the shortage of 25,000 dwellings grew ever larger.
Later on Tuesday, landlords would have given a little fist pump on hearing Labour Leader Andrew Little give his strongest opposition yet to any suggestion of a capital gains tax. Fresh from 20% rise in prices, those landlords who bought a NZ$600,000 rental with a 60% mortgage a year ago are sitting on a tax-free gain of 50% on their equity and are newly confident that, even with a change of Government, that they will not have that gain taxed.
But that’s not actually the full story, he says. “By the time National City Lines was buying up these streetcar companies, they were already in bankruptcy.”
Surprisingly, though, streetcars didn’t solely go bankrupt because people chose cars over rail. The real reasons for the streetcar’s demise are much less nefarious than a GM-driven conspiracy — they include gridlock and city rules that kept fares artificially low — but they’re fascinating in their own right, and if you’re a transit fan, they’re even more frustrating.
Auckland’s beaches, clean air and environmentally friendly image are clear selling points for foreign property investors, analysts said. And New Zealand’s property investment laws — which do not include a stamp duty or a capital gains tax — are seen as more welcoming than those of Singapore, Hong Kong and other global investment hubs.
“Offshore investors are having an effect” at all levels of the residential market, said Layne Harwood, country head for New Zealand at the global property consulting firm Knight Frank. “They’re here for security of capital.”
By the way, if you click on the article, notice who took the pictures the NYT used…
The most fundamental challenge is how to balance what communities judge is best for them with what is best for Auckland and the country. There is a need to relax regulatory controls on height and density, while retaining provisions for quality urban design. That will allow more dwellings per unit of land, more choice, and improve housing affordability.
We need better tools, such as road pricing and congestion charging, to raise revenue from the value created by infrastructure.
For construction productivity, many changes are needed. Particularly, I would like to see the Productivity Commission make an inquiry into how to get a 25 per cent productivity gain in residential construction within 10 to 15 years.
After another cyclist friend was injured by potholes, Wanksy, an artist from Greater Manchester, England, decided to act. He used washable paint to draw penises around potholes in his neighborhood, and suddenly, they were repaired in 48 hours.
“People will drive over the same pothole and forget about it,” Wanksy said in an interview. “Suddenly you draw something amusing around it, everyone sees it and it either gets reported or fixed.” A Bury Council spokesman disagreed: “Painting obscenities around potholes will not get them repaired any quicker, but simply waste valuable time and resources.”
Bored Panda journalists found that using the Manchester City Council website, it took 5 clicks, 1 form, 1 survey, and a minimum of 5 days just to get a pothole inspected.
This isn’t to say that there aren’t people who love their cars. The phenomenon of sports cars, weekend cars and collector cars is real. So, too, is the allure for many people of road trips, scenic highways or weekend drives through the country. Rather, the story Norton disputes, which he has written about in the book “Fighting Traffic: The Dawn of the Motor Age in the American City,” is the history that says that we’ve built car-dependent cities and suburbs because that’s what Americans wanted, the story that says all our surface parking lots and spaghetti interchanges are a pure product of American preferences.
“When I actually looked into the history record, documents from the time, I found just the opposite,” Norton says. “What Americans in cities wanted in the ‘20s was to get the cars out.”
Transport is the leading edge of the debate on the council’s core role: providing the infrastructure for a society to function smoothly. As usual, the infrastructure you don’t see until it breaks, like sewers & waterpipes, attracted no attention.
Government intransigence on funding methods meant the council couldn’t use either of the options it had proposed in lengthy consultation, a fuel tax or tolling motorways. If the council was going to fund any of a list of capital projects deemed necessary, not just desirable, something else had to be thought up. The short-term levy – $99 for every residential property, $159 for business properties, both + gst to make the levies in practice $114 & $159 – is in place for 3 years.
Opponents argued the levy hadn’t been consulted on, and it hadn’t, but what to do? Abandon hundreds of millions of dollars of infrastructure work or get on with it?
Commuters are more likely to be anxious, dissatisfied and have the sense that their daily activities lack meaning than those who don’t have to travel to work even if they are paid more. Those were the findings of a study by the Office for National Statistics looking at commuting and personal wellbeing…
It found that each additional minute of commuting time made you feel slightly worse up to a certain point. However, strangely, once a commute hit three hours then the negative effects dropped off.