Monthly Archives: January 2013

Middle class in Manhattan?

Manhattan. CC image from sakeeb.

Breaking news! Last week, the New York Times reported that it is expensive to live in Manhattan. The Times frames the question through the lens of the middle class, asking what the definition means in the context of they city’s densest borough.

In a city like New York, where everything is superlative, who exactly is middle class? What kind of salary are we talking about? Where does a middle-class person live? And could the relentless rise in real estate prices push the middle class to extinction?

There’s lots of discussion in the article about incomes in New York, as well as the high cost of living – particularly for housing. The article notes that the New York, urban context makes the traditional symbols of the American Dream (e.g. home ownership) less applicable, and most of the text is spent searching for some other indicator of middle-class-ness. Matt Yglesias notes that such a search for a single metric isn’t always useful. Likewise, it’s not as if this is a new topic in New York, or even for the Times.

There’s lots of discussion about housing costs and the demand for living in a place like Manhattan, but not a single word about housing supply. I understand the author is looking to explore the perception of what constitutes the middle class, but a word about the supply of housing is warranted. Even a short mention of the constraints to supply would be a worthwhile addition to these kinds of articles.

David Schleicher’s twitter response asked that same question, and provided a link to Glaeser, Gyourko, and Saks’ work on regulatory constraints to housing supply in New York. From the paper’s abstract:

Home building is a highly competitive industry with almost no natural barriers to entry, yet prices in Manhattan currently appear to be more than twice their supply costs. We argue that land use restrictions are the natural explanation of this gap. We also present evidence consistent with our hypothesis that regulation is constraining the supply of housing so that increased demand leads to much higher prices, not many more units, in a number of other high price housing markets across the country.

As noted, Manhattan certainly isn’t the only place with these kinds of constraints. Another recent article focuses on San Francisco, this one from tech writer Farhad Manjoo. Manjoo makes the case that San Francisco needs to grow in the face of tremendous demand for urban living. More importantly, he argues that opponents to growth, those who fear how growth might change the things they love about San Francisco, need to get over themselves.

Don’t look good fortune in the mouth. Yes, growth will bring some problems. But they’re not nearly as bad as the problems you’ll find in decline (ask Detroit). Instead of complaining or blocking growth, San Francisco’s old-guard would do better to propose ways to ease the city’s transition into its digital future. This doesn’t mean opposing newcomers. It means recognizing a new reality, that San Francisco needs to become much larger and more accommodating place than it is. And it means adopting polices that will make that reality a pretty good one.

In particular, for San Francisco, adopting that reality means one thing above all: It needs to build more buildings.

As an example of the fear of change, Manjoo links to this article by David Talbot, blaming the influx of tech workers to the city for forcing things to change – forcing the city to battle for its own soul.

One point that Talbot ignores is that obstructing the physical change in the city (e.g. blocking development) will not save the idealized city he loves. In fact, it might even accelerate the process of gentrification.  Some level of change is inevitable. Fighting any kind of change to the physical environment might even accelerate changes to the city’s socioeconomic environment.

While the overall thrust of Manjoo’s policiy is correct, it’s not hard to see why many fear for the loss of San Francisco’s soul. Manjoo laments that the city has not built more densely, and implies that old Victorian houses are the culprit: “this city is defined by, and reveres, its famous Victorian houses” he writes.  “Those houses are very pretty. They’re also very inefficient. Collectively, they take up a lot of space, but don’t house very many people.”

The truth is that San Francisco could add a great deal of new housing supply without touching those houses that are worthy of preservation. Consider this thought experiment from Keep Houston Houston for transit improvements and upzoning in the Sunset District:

All of this in one neighborhood, and without straying from the basic SF vernacular architecture of low/mid-rise, wood-framed buildings. Apply this same rubric to the rest of the city, allow towers in a few places, you could easily accommodate 200,000 more people.

Likewise, Stephen Smith makes the case for dramatic upzoning in large parts of Brooklyn, but not on the borough’s brownstone blocks:

In some neighborhoods, this sort of conservative zoning makes sense. The tree-lined blocks of Brooklyn Heights and Park Slope, for example, thick with brownstones and pre-war apartment houses, are urban treasures worth preserving.

But northern Brooklyn is not brownstone Brooklyn.

We’ve seen the same thing in DC (and seen the impacts of zoning). And we’ve also seen anecdotes of what adding new supply can do to downmarket properties, thanks to the process of filtering.

Each of these strategies at least hold the promise of keeping the market rate housing prices within reach for the middle class. Obviously, the dynamics of these markets are quite complex, and the nature of neighborhood change is not well-understood (not in a way we can forecast, anyway) and the housing market for a given metro area is larger than any one jurisdiction, but the macro signs are quite clear. Given the constraints to supply in the Zoned Zone, removing these regulatory constraints on the market’s ability to add supply seems like an obvious prerequisite to a change in policy.

To Charles Marohn’s concerns about density, and those that fear for San Francisco’s soul: will this new development ensure a quality place? No, probably not. But allowing this kind of growth is a necessary-but-not-sufficient condition.

Density – the limitations of zoning

San Francisco. CC image from C1ssou

A few days ago, Charles Marohn posted “It’s so much more than density” on his Strong Towns blog.  In it, Charles pushes back against the idea that density is good, arguing that the reality of great places is more complex. Marohn’s conclusion is spot on, but throughout his post he creates several strawmen arguments, some of which rubbed me the wrong way:

Equating planners with zoners: Charles styles this as “planners zoners.” In this world, all planners love zoning, and love the available tools that zoning offers. In my professional experience, this is rarely the case.

I’m not sure why planners zoners are generally so keen on density, but they are, to the point where it often comes across as an obsession. I have a theory. I think a lot of planners zoners yearn to be spatial planners. They go to school to build great places. They get out into the real world and are given this ridiculously blunt instrument — zoning — and are frustrated that they can’t wield it to create Paris. Few stop to ask what zoning regulations were used to create Paris (hint: there weren’t any). Density, especially when given as a bonus for attainment of certain performance objectives, is the closest thing a modern planner zoner gets to their professional roots. We all suffer the consequences.

Perhaps it’s the personalization of this that bugs me, because the analysis of the systems is spot-on. Zoning is a blunt instrument at best, but many of my fellow planners (not merely zoners) do indeed ask about Paris. They understand the limitations of zoning. They are also constrained within the system. They make use of the tools available.

The most realisitic path to change is from within, usually via a zoning re-write like currently underway in DC, or recently completed in Philadelphia. Wholesale repeal of zoning codes seems unrealistic. Even Houston, without Euclidian use zoning still bears many of zoning’s ills through other regulations, such as parking requirements. Change in the regulatory environment is likely to be incremental.

Still, these professionals must contend with pressures on them from various stakeholders. In Philly, the city council is trying to un-do many of the recent changes. In DC, many of the bad practices Marohn decries (using the mindset of zoning as incentive rather than allowance)  are urged by residents, not by planners.

Location matters: Regarding the desirability of density, there needs to be a distinction between using bonus density as an incentive and merely allowing greater density and letting the market supply it organically. Part of this confusion might stem from your frame of reference. During the rise of the housing bubble, Paul Krugman made note of America’s two distinct housing markets:

When it comes to housing, however, the United States is really two countries, Flatland and the Zoned Zone.

In Flatland, which occupies the middle of the country, it’s easy to build houses. When the demand for houses rises, Flatland metropolitan areas, which don’t really have traditional downtowns, just sprawl some more. As a result, housing prices are basically determined by the cost of construction. In Flatland, a housing bubble can’t even get started.

But in the Zoned Zone, which lies along the coasts, a combination of high population density and land-use restrictions – hence “zoned” – makes it hard to build new houses. So when people become willing to spend more on houses, say because of a fall in mortgage rates, some houses get built, but the prices of existing houses also go up.

For those of us in the Zoned Zone, simply allowing for more growth (and density) will produce different results than a similar regulatort adjustment in Flatland.  Anecdotes of these constraints in expensive cities abound: consider recent articles from Brooklyn and San Francisco, among others.

Marohn  notes that density does not cause productivity in places; density is a byproduct of productive (and valuable) places:

A strong town — a productive place — is generally of a higher density than an unproductive place. That financial productivity, however, is not caused by the density. There is a correlation — as productivity goes up, so does density — but one does not cause the other.

Leaving aside the question of correlation vs. causation, nothing in Marohn’s post takes the context of the place and pent-up market demand into account. Two planners talking about the desirability of density could use the same argument, but the location of the planner (Flatland or the Zoned Zone) dramatically changes the impact of that argument. In Flatland, where supply is not constrained, density not supported by the market must be shaped via some sort of regulation. However, urbanists advocating for density in the Zoned Zone are often just asking to remove the constraints that make density illegal.

With that in mind, attacking planners for pushing density without considering their context and market conditions (and the nature of the intervention) can confuse the issue. There’s no doubt that incentives can backfire – zoning is a blunt tool, after all. But that’s not always the motivation when arguing in favor of more density.

Perceptions of density often miss the mark: Marohn also cites the example of urban renewal as a failure of the fetishizing of density. I’m not sure that this narrative holds up to the history, however – at least as it applies to the density of urban renewal projects. As I’ve written before, perceptions of density are often well off from the reality.

This isn’t to endorse either the process or product of urban renewal, but the goals of those projects were often aimed at reducing density and overcrowding.

Beware unintendend consequences: As I noted at the top of this post, I don’t disagree with Marohn’s conclusion at all:

Ultimately, the notion that we can solve the problems that we face in our cities by simply increasing the density requirement in our zoning codes is not just naive, it is dead wrong. Density is an expected byproduct of a successful place, not the implement by which we create one. Building a Strong Towns is a complex undertaking, one that defies a professional silo or a simple solution.

More on Marohn’s follow-up, Density Redux, to follow…

Metro highlights frequency in new bus map

This week, Greater Greater Washington highlighted WMATA’s latest iteration of their new bus map (as post on the first iteration is here), which opts for a diagrammatic representation of the bus network, highlighting frequent, all-day bus services over infrequent and irregulat coverage bus routes.

The new map is a huge improvement of the old one.  Digging through the archives, I found this post, with a screencap of roughly the same part of the city – just for the purposes of comparison.

The inspiration for posting about the shortcomings of the WMATA map back in 2010 came after reading Jarrett Walker’s blog.  Walker emphasizes the value of frequency, and the importance of highlighting frequent services in an operator’s communications, such as maps. WMATA’s old maps made no such distinctions – in fact, the map highlighted rather useless distinctions, such as whether or not a bus crossed state lines.

The timing of Metro’s release of the new map was fortuitous.  Last week, I had the opportunity to participate in Walker’s two-day transit network design course.  The exercises in the course force participants to deal with the trade-offs between conflicting goals, limited budgets, constrained geography, and the fundamental geometry of efficient transit service.

(Jarrett has posted reviews of the DC course here – I would definitely recommend the course both for those working on transit/transportation, as well as anyone interested in how cities function)

On comments

CC image from premasagar.

A few days ago in my RSS reader, David Levinson’s Transportationist blog has a post about the end of comments on his blog. I’m somewhat sad, as (at appropriate volumes) comment sections can produce valuable discussion. Commenting on blogs was part of the reason I started my own. David’s platform (hosted by the University of Minnesota) requires registration for commenting, however – the reason I never offered comments on his blog. If compulsory registration was indeed out of his control, then there’s not much difference between disallowing comments and burdening them via registration.

David’s post shared a few links on blog comments I found interesting.

On trolling: Never read the bottom half of the internet. The idea here being that trolls are aiming to provoke you into an argument, whether solely for the purpose of exposure and notoriety, or to discredit the idea of a post.

The sad thing is, tolling works: One of the purposes of trolling would be to discredit the main content, fighting an honest post with FUD, disingenous comments, or outright lies – all without accountability. The sad thing is that it works. From the Milwaukee Journal-Sentinel:

A new obstacle to scientific literacy may be emerging, according to a paper in the journal Science by two University of Wisconsin-Madison researchers.

The new study reports that not only are just 12% of Americans turning to newspaper and magazine websites for science news, but when they do they may be influenced as much by the comments at the end of the story as they are by the report itself.

In an experiment mentioned in the Science paper and soon to be published elsewhere in greater detail, about 2,000 people were asked to read a balanced news report about nanotechnology followed by a group of invented comments. All saw the same report but some read a group of comments that were uncivil, including name-calling. Others saw more civil comments.

“Disturbingly, readers’ interpretations of potential risks associated with the technology described in the news article differed significantly depending only on the tone of the manipulated reader comments posted with the story,” wrote authors Dominique Brossard and Dietram A. Scheufele.

“In other words, just the tone of the comments . . . can significantly alter how audiences think about the technology itself.”

Comments as a dinner party: One piece that immediately came to mind in reading Levinson’s links was this On The Media session (written semi-transcription here) with Ta-Nehisi Coates, discussing the challenges (positive and negative) of comment sections – perhaps thinking of comments as a dinner party with interesting conversation, but noting that good commenting requires curating the comments – e.g. a lot of work.

Nonetheless, I love the idea of curating comments, if only thanks to seeing interesting and productive discussion in many blogs.  Perhaps these places have the virtue of a critical mass of commenters (unlike, say, this blog) without the vice of too much trolling – or even too much volume (with too many people shouting, how can one expect to get a word in edge-wise?)

Application to this blog: Limited. I don’t get too many comments here, nor do I post frequently to spark much discussion. Despite the value in commenting under the right circumstances, one of Levinson’s last points did hit home for me:

If you have comments, you should get a blog (or if you have one, post there). As someone on the web remarked, that will get a lot more attention for both of us due to Google’s PageRank formula than posting on comments with a nofollow tag.

Again, that’s part of the reason I’m here.

Avis, Zipcar, and the spectrum of car-sharing services

Old Avis ad in Australia - CC image from Bidgee

Last week’s big transportation news: Avis purchased Zipcar for a cool $500 million.  Reaction to the sale is all over the map, with some analysts praising the move and some hating it.

On the ‘pro’ side of the ledger – Felix Salmon:

The acquisition solves a number of problems with the Zipcar model. For one thing, it gives Zipcar easy access to the one thing it needs more than anything else: money. The car-rental business is at heart a financing business: you need to be able to finance the acquisition of new cars, efficiently dispose of them once they get too old and too used, and generally make profits by juggling enormous cashflows both coming in and going out. When you’re a small and risky company like Zipcar, that kind of fleet and cash management is much harder than when you’re a giant like Avis Budget.

The other big problem that Zipcar had was that it couldn’t meet demand at weekends: the company’s slogan is “wheels when you want them”, but in practice the cars tended to be sold out at precisely the times that members really wanted them. By merging with Avis, Zipcar gets to offer its members Avis cars when dedicated Zipcars are unavailable

On the ‘con’ side, pretty much anyone who hates the standard car-renting process – Sarah Lacy:

That’s how much I loathe Avis. As far as I’m concerned they only “try harder” to piss me off. And thanks to a tightly controlled oligopoly, the rest of the rental car world isn’t much better. There’s little innovation or even need to innovate, when a few players control the entire market.

People hate renting cars – myself included.  The process stinks all around.  Pricing is anything but transparent or simple; even with a reservation you must wait in line; employees are constantly pushing insurance packages of dubious value; you constantly feel like you’re about to get nickel and dimed for a small scratch or a gas tank that’s not quite full – the entire process feels kinda sleazy.

With that in mind, it’s easy to understand the angst of some users (see the concerns voiced in Ben Kabak’s post).  From the ‘man on the street’ in this Dealbook summary of the sale: “Please don’t let them screw it up.”

So far, Zipcar is looking to reassure folks they won’t lose that innovative spirit, with the CEO expecting Zipcar to remain a standalone subsidiary, also while announcing plans to offer memberships to the service without the annual fee.

For me, however, Zipcar use is way down.  My personal membership expired several years ago.  I maintain an account so I can be a member of my employer’s business membership (and will use that service for business trips that require a car), but my personal use is almost non-existent.  Conversely, I’ve been using Car2go‘s point-to-point carsharing far more frequently in DC (and I’m not the only one).

Car2go’s service isn’t an exact analogue for Zipcar, however.  If you think of carsharing services as a spectrum, between traditional car rentals on one hand (longer terms, frequently used during travel) and short trips within the city on the other (as Car2go’s trips have more in common with taxi rides for DC users than car rentals), there is room for a whole host of products and services, each tailored for a different segment of the travel market.

The spectrum of car-based transport would look something like this:

  • Car ownership
  • Traditional car rental (home space; by the day)
  • Zipcar-type car-sharing (home space; by the hour)
  • Car2go-type car-sharing (point-to-point; by the minute)
  • For-hire service (taxi, sedan services, etc; by the minute/mile)

Note: there are lots of other models out there, including ones where car owners can offer up their personal vehicle for rentals when they are not using it – sort of an Airbnb for cars.

Zipcar’s current model (where every car rental must begin and end at the same ‘home’ parking space) is more similar to the traditional rental car model, just dispersed to locations around the city, and with the details of the rental handled online and with standardized pricing.   Lydia DePillis notes this might not be the cutting edge in carsharing services anymore, but offering a wide variety of useful vehicle types (including the Zipvan) is valuable.

The next evolution for a service like Zipcar would be to offer point-to-point car sharing (rumors hint that Zipcar is interested in this market as well). Fears of Avis turning Zipcar into something more Avis-like are valid, but the opposite could be just as valuable – airport car rentals with the ease of a Zipcar online reservation.   Others are working on this very concept as I type.

Even without tailoring a business model to this market, there’s opportunity for disrupting the standard airport-car-rental-while-traveling model. On a recent trip from DC to San Diego, I found myself stuck at my downtown hotel, wanting to get to the beach without the burden of a large taxi fare – an Car2go’s all-electric San Diego fleet (and a membership that works across the country) was there to serve.

No need to deal with the hassle of renting car – my hotel had a free shuttle from the airport.  On trips like this (where the beach trip is the only one I wanted a car for), why bother?  Perhaps this is a place where a company like Avis can learn from car-sharing.