The Kinder Institute and Harvard University’s Joint Center for Housing Studies released Tuesday morning their annual reports on the state of housing in the Houston area and the nation. Together, they painted a picture of a deepening divide between the prospects of current homeowners, whose equity has been buoyed by record-breaking home price appreciation, and renters, who have seen the monthly costs of buying a home rise far more quickly than wages.
The median-priced home in the suburbs of Clear Lake and Jersey Village, for example, were priced between $162,000 and $175,000 in 2011, according to the Houston Association of Realtors. They now go for $300,000 to $317,000.
“You have to go farther and farther out until you find a home that’s affordable,” explained Stephen Sherman, a researcher at the Kinder Institute. “The whole saying is drive until you qualify. We’re finding that people will have to drive even more” — a development which will have rippling implications on traffic and the way floodwaters drain…
“Suburban Houston — and new homes in suburban Houston — used to be extremely affordable,” said Lawrence Dean, the Houston regional director for Zonda, which does market research related to new home construction. Since then, the costs of land, materials and labor have all shot up. These days, it’s near impossible to build a home for less than $200,000, he explained.
This gets at three long-standing questions about suburban life:
- How far will people be willing to drive from the big city or other population centers in order to get a cheaper, bigger home? In some metro areas, this extends past 40 miles and multiple ring highways. If more people can work from home, more suburbanites might be willing to be further out.
- Even as suburbanites protect and celebrate rising housing prices, this also limits what others can purchase. Suburbanites have a long history of moving in and pulling up the gates behind them. But, even as suburban homeowners watch their personal wealth grow, others will not necessarily get the same opportunities.
- Is the primary plan for affordable housing in American metro regions to just keep the sprawl going? At some point, this may not be possible due to conditions – see the price jumps in construction cited above – or changing ideologies about where to live.
It would be interesting to compare this to other metropolitan areas across regions and price points.