Category Archives: Sociology

Helping readers see patterns and the bigger picture in new housing price data

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The headline reads:

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Home prices fell for the first time in 3 years last month – and it was the biggest decline since 2011

This quickly relays information about recent trends – prices went down for the first time in a while – as well as longer patterns – biggest drop in over a decade.

Next are some figures on housing affordability:

Now, housing affordability is at its lowest level in 30 years. It requires 32.7% of the median household income to purchase the average home using a 20% down payment on a 30-year mortgage, according to Black Knight. That is about 13 percentage points more than it did entering the pandemic and significantly more than both the years before and after the Great Recession. The 25-year average is 23.5%.

The housing affordability statistic is put into terms accessible to a broad audience: nearly 33% of the median household income is needed to buy the average house with common mortgage terms. Additionally, this percentage is higher than recent years and a longer 25 year stretch.

Some housing markets are seeing bigger price declines than others:

Some local markets are seeing even steeper declines over the last few months. San Jose, California, saw the largest, with home prices now down 10% in recent months, followed by Seattle (-7.7%), San Francisco (-7.4%), San Diego (-5.6%), Los Angeles (-4.3%) and Denver (-4.2%).

It could be noted that these are expensive and hot real estate markets. Yes, they had larger drops but they had been pushed higher in recent years than many other markets.

And the article ends with information on mortgage rates:

The average rate on the popular 30-year fixed mortgage began this year right around 3%, according to Mortgage News Daily. It climbed slowly month to month, pulling back slightly in May but then shot more dramatically to just over 6% in June. It is now hovering around 5.75%.

This highlights the rise in mortgage rates this year. Some broader context might be helpful; what was the average rate before COVID-19 or over the last 10 years?

This article provides numerous statistics and often puts the figures in context. Yet, it does lead one lingering question: what is the state of housing prices overall? One answer might be change after a period of trends during COVID-19. Another might be to focus on different actors involved: how does this affect the housing industry or what about the difficulty of some to get into the housing market or it could be a story about higher housing values for many homeowners.

Statistics are not just facts thrown into a void; they require interpretation and are often applied to particular concerns or issues.

Americans love highways so much they are willing to volunteer to keep them clean?

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I saw my share of Adopt-a-Highway signs this summer on driving trips. Here is some of the history of the program:

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The Birth of Adopt-a-Highway

The idea hit James Evans like an empty soda can, or maybe it was a discarded candy wrapper. Evans, an engineer for the Texas Department of Transportation, was driving one day in 1984 when he saw litter blowing out of the back of a pickup truck. Littering was a growing problem in Texas at the time, and while Evans knew that his department didn’t have the resources to combat it, he saw a prime opportunity to promote volunteerism. One year later, Billy Black, the public information officer for the Tyler District of the Texas Department of Transportation, collaborated with Evans and organized the first Adopt-a-Highway program.

How the Program Works

The program varies slightly by state, but volunteers typically apply to adopt at least two miles of highway for two years, and are responsible for cleaning that stretch at least four times per year. In return, the adopter’s name is recognized on a sign along that stretch of highway. The Adopt-a-Highway program saves taxpayers millions of dollars in cleanup costs and allows state governments to allocate transportation funds to other projects. The number of state employees devoted to highway cleanup and beautification has plunged since the advent of the Adopt-a-Highway program. A number of states, including New Hampshire, have Sponsor-a-Highway programs, where volunteers make donations to pay for maintenance crews to clean a stretch of highway in exchange for recognition on a sign…

The Adoption Movement Spreads

The Adopt-a-Highway program was a huge success in Texas and other states soon took notice. The program, or a variation thereof, eventually spread to all 50 states, as well as Puerto Rico, and several countries, including Australia, Japan and Spain. The most common adopters are civic groups and local businesses, though individuals occasionally adopt. Celebrities, including Bette Midler and Robin Williams, helped raise the profile of the program by adopting their own stretches of highway. Today, a handful of for-profit companies manage the sponsoring of highways by large companies looking for positive publicity and what amounts to advertising space on a small billboard.

The description above hints at the convergence of multiple forces: a growing environmental movement, efforts to encourage civic engagement and pride, looking for ways to cut government costs, and opportunities for some marketing.

But, this could be put simply: largely for free, Americans clean up highways. Groups and individuals take time out of their schedules to pick up garbage and debris. Americans love driving and the way of life it is tied up with so much that they clean the highways that enable quick travel via car. Adopt-a-highway works because Americans like highways so much.

Consider an alternative approach. Instead of cleaning up littering and criminalizing the practice, what about deemphasizing highways and major roadways and pursuing other forms of transportation and denser housing? This may seem like a difficult task but so is cleaning the tens of thousands of miles of highways, whether through paid employees or mobilizing volunteers all over.

The water needed to keep the grass green and trees alive at California mansions

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Due to water shortages and water restrictions in California, we now know how much water some celebrities are using for their homes and grounds:

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Now, the celebrities are among the 20,000 residents in the Las Virgenes Municipal Water District – that holds jurisdiction in the cities of Agoura Hills, Calabasas, Hidden Hills, and Westlake Village – forced to abide by water restrictions with the installation of restrictive devices that will reduce the amount of water used during showers and for sprinklers.

Amid the relentless drought, the water district moved to ‘Stage 3’ restrictions on June 1 to reduce water consumption by at least 50 percent, according to the Los Angeles Times.

Kim Kardashian is one of the A-list celebrities that has received notice to limit the water usage at her Hidden Hills home and her fixer-upper property she purchased next store – after she exceeded water use by about 232,000 gallons in June…

Rocky Balboa actor Stallone and his model wife, Jennifer Flavin, reportedly went over their water budget at their Hidden Hills home by about 533 percent, or 230,000 gallons, in June. The couple used 195,000 gallons of excess water in May…

Meanwhile, NBA star Wade also received a notice that he exceeded his water limit by 90,000 gallons or 1,400 percent in June. While Wade’s water usage is an improvement since May, it’s still more than most users.

While more than just celebrities have received these notices, the water figures here are staggering. To keep a large house and property going, they have exceeded their allotted use by a lot of water. If this does not contribute to the idea that a lush green lawn and landscape is a status symbol, I do not know what does.

On the flip side, imagine a major celebrity eschewing the green lawn and garden-filled property for a property with a lot fewer water needs. Could images of a celebrity yard of drought resistant and native plants help turn the tide against this kind of water usage? Or, a major social media influencer? Overcoming decades of the association between homeownership and status with a green lawn is going to be hard to overcome.

(Consider this a companion post to the one yesterday about California property owners getting money to tear out their grass lawns.)

Paying California property owners to tear up their grass lawns

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A good number of property owners in California can receive money to remove grass:

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The largest district in the state, the Metropolitan Water District serving 19 million people in Southern California, is paying $2 per square foot of grass pulled out. Water district customer cities and agencies can add more…

The Metropolitan Water District told CNN the number of requests for grass removal rebates jumped four times in July, to 1,172 applications…

The horrific drought led Larry Romanoff to combat climate change by ripping out his grass and replacing it with cactuses and decorative stones. Romanoff will collect $10,500, a whopping $6 per square foot of lawn removed from his desert home…

The Coachella Valley Water District and its customer, the city of Rancho Mirage, are each paying Romanoff $3 per square foot of lawn torn out…

The Public Policy Institute of California’s Water Policy Center estimated for CNN nearly 50% of the 409 water agencies in California are offering some sort of turf removal rebate, both residential and commercial.

Paying property owners now will presumably pay off in the long run as it reduces water use.

Given the water shortages facing California and other Western states, how much money will be allocated to such programs and how many homeowners will go for this? Getting rid of the grass lawn may lead to fewer maintenance needs. But, the grass lawn is such a key part of both the image and the mystique of the single-family home. It might be harder for many to envision a property of rocks and cacti or more native and drought-resistance plants.

Linking “newness” in a home with particular materials, styles

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The impression of “newness” in a home is connected to particular updates and items:

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But not simply any new floors and counters will create the desired effect. The feeling of newness is largely relative, and the only real key to creating it is banishing the things that people expect to see in a dwelling built decades ago—“landlord beige” walls, all-white appliances, dingy carpet, laminate counters, wood so warm-toned it’s practically orange. Gray floors and all of their comorbid design phenomena are cool and crisp and modern by comparison, even if they’re also crushingly boring and totally character-free and really limit a space’s potential capacity to feel warm and alive and like a home.

And the purpose of these changes is to sell properties:

In theory, the things that make up the interior of your home should be either beautiful or useful; if you’re lucky, they’ll be both. And surely some people do lose their mind for gray laminate or subway tile or barn doors, and not just because there’s no accounting for taste. Once a particular design element becomes a shorthand for newness and freshness and successful domesticity, people come around to it precisely because they want their home to reflect those qualities. But that’s a different phenomenon than appreciation for the thing itself—for how nice it is to look at, or how much more functional it makes a space. In the hands of flippers and landlords, these choices are generally made not by people who want to fill the world with the best, safest, most comfortable homes possible but by those looking for a return on the bets they’ve made on the place where you’ll start your family or play with your future grandkids. They’ve chosen these things just as much for what they aren’t as for what they are—inoffensive, inexpensive, innocuous. These houses aren’t necessarily designed to be lived in. They’re designed to go into contract.

I wonder if this process mirrors that of the fashion industry and other culture industries. The production, sale, and popularity of created works and objects moves in waves and trends. Not too long ago, homes featured granite countertops and stainless steel appliances; now it is subway tile and grey floors; shortly it will be something else. Or, formal living rooms were a thing to open concept to providing smaller spaces to enable working from home. The key for those who want to make and sell properties is to appear on trend or close to it.

A related argument: homeowners and sellers exhibit their investment, emotional and economically, in a property by updating it to more recent trends. They show that they care about the home fitting in a new era rather than being left behind. It can suit a new family just as well as it did its original occupants.

Would it be possible to signal newness in different ways? A particular smell? How the occupants use the space? Altered infrastructure (ranging from new furnaces or electrical systems to greener options)? Integrating the Internet, screens, and sounds?

Downtown activity in American and Canadian big cities before and after COVID-19

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A new report looks at recent activity in the downtowns of American and Canadian cities compared to that of several years ago:

Activity is down quite a bit in multiple major cities.

Officials in Cleveland do not think the national study, based on cell phone data, quite lines up with what they see in their city:

City officials and the Downtown Cleveland Alliance say the U.C. Berkeley study doesn’t provide an accurate accounting. The “downtown area” in the study doesn’t match what Cleveland locals would describe as their downtown, according to maps shared with cleveland.com.

Data that the DCA publishes each month is less grim, but also doesn’t point to a full recovery.

DCA’s recovery report said there were 4.01 million visits to downtown in May, a 71% recovery compared to May 2019. Visits improved to 4.14 million in June, a 77% recovery, according to the DCA.

There is the matter of measuring this well and the matter of interpreting and using the data for particular purposes. If the consensus of researchers is that downtown activity is down in many places, what policy, economic, and social implications would this have?

Why it can take months for rent prices to show up in official data

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It will take time for current rent prices to contribute to measures of inflation:

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To solve this conundrum, the best place to start is to understand that rents are different from almost any other price. When the price of oil or grain goes up, everybody pays more for that good, at the same time. But when listed rents for available apartments rise, only new renters pay those prices. At any given time, the majority of tenants surveyed by the government are paying rent at a price locked in earlier.

So when listed rents rise or fall, those changes can take months before they’re reflected in the national data. How long, exactly? “My gut feeling is that it takes six to eight months to work through the system,” Michael Simonsen, the founder of the housing research firm Altos, told me. That means we can predict two things for the next six months: first, that official measures of rent inflation are going to keep setting 21st-century records for several more months, and second, that rent CPI is likely to peak sometime this winter or early next year.

This creates a strange but important challenge for monetary policy. The Federal Reserve is supposed to be responding to real-time data in order to determine whether to keep raising interest rates to rein in demand. But a big part of rising core inflation in the next few months will be rental inflation, which is probably past its peak. The more the Fed raises rates, the more it discourages residential construction—which not only reduces overall growth but also takes new homes off the market. In the long run, scaled-back construction means fewer houses—which means higher rents for everybody.

To sum up: This is all quite confusing! The annual inflation rate for new rental listings has almost certainly peaked. But the official CPI rent-inflation rate is almost certainly going to keep going up for another quarter or more. This means that, several months from now, if you turn on the news or go online, somebody somewhere will be yelling that rental inflation is out of control. But this exclamation might be equivalent to that of a 17th-century citizen going crazy about something that happened six months earlier—the news simply took that long to cross land and sea.

This sounds like a research methods problem: how to get more up-to-date data into the current measures? A few quick ideas:

  1. Survey rent listings to see what landlords are asking for.
  2. Survey new renters to better track more recent rent prices.
  3. Survey landlords as to the prices of the recent units they rented.

Given how much rides on important economic measures such as the inflation rate, more up-to-date data would be helpful.

Encyclopedia Brown’s Idaville sure has a lot of crime

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The kid’s book series involving boy detective Encyclopedia Brown includes this description of the town of Idaville, the setting for the stories and home to Leroy Brown and his family:

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Idaville was like most seaside towns. It had lovely beaches, three movie theaters, and two delicatessens. It had churches, a synagogue, and four banks

But, read enough of these cases and it all adds up to something: Idaville is not like most seaside towns as it has a lot of crime. Enough crime to fill 29 books with numerous cases in each. Crimes ranging from small violations to larger issues. Lots of different kinds of criminals.

This is not an unusual perspective on crime. Television shows often have a similar message, particularly if they are long-running: crime is happening all of the time. This has the potential to change how viewers understand crime and locations. If you see a particular place associated with criminal activity over and over, how much of an impact does this have?

Some of the other phrases in the intro to the cases provide further clues at how crime is perceived in Idaville and in these cases: “the forces of law and order were in control” and “the town’s war on crime.” Is this the normal experience of small towns or just how we often present mysteries and the work of police?

How much a declining mall can cost a community in sales tax revenue: almost $20 million a year

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The decline of Stratford Square Mall in Bloomingdale, Illinois meant the sales tax revenue for the community dropped dramatically:

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Stratford was still a cash cow in 2012, generating $20.3 million in sales tax revenue. But that number has quickly dwindled in the last 10 years, with the mall producing just $466,080 in 2021, village officials say.

“Dead malls” or struggling malls are a problem in numerous American communities. Popular for decades, these properties provided shopping, entertainment, and social space for visitors, jobs, and tax revenues for communities.

As communities look to transform these properties (and the possibilities are broad), one large factor will be how much tax revenue the new land use generates. Can they ever come close to generating that kind of sales tax revenue? Restaurants and entertainment or experiential spaces can help close that gap. Residences, however, do not bring in that kind of money (unless those new residents shop regularly at local businesses). If not, what other clear benefits will the reconfigured properties offer the community?