Modernization, smaller homes, and social class

I wanted to come back to a post from earlier this year where an economist argues that modern conveniences mean people can save money by living in smaller houses:

DR. SHILLER: Big houses are a waste. People are still in a mode of thinking about houses that is kind of 19th century. As we modernize, we don’t need all this space. For example, we don’t need elaborate kitchens, because we have all kinds of delivery services for food. And maybe you don’t need a workshop in your basement, either. You used to have a filing cabinet for your tax information, but now it’s all electronic, so you don’t need that, either. And bookshelves, for people who read a lot. We have electronic books now, so we don’t need bookshelves anymore…

DR. SHILLER: Having a big house is a symbol of success, and people want to look successful. People have to know about your achievements. How do you know, really? Who knows what people are doing in their day job? But you do see their house…

DR. SHILLER: When it comes to housing, there are books about this in the last 20 years—including “The New Small House”—that talk about designing houses to look impressive as well as function with a smaller scale.

Just like we’re developing Uber and Lyft and Airbnb using existing resources more efficiently, we can also build houses that are better at serving people’s needs without being big.

All of this could indeed be true. Many of the items people purchased just a few years ago may not be necessary. However: some of the services mentioned above seem to be tied to social class and age. Which people in society are getting all of their food delivered? How many people are doing all their taxes and bill paying online? Who needs space to store books, clothes, toys, electronics, gym equipment, etc.? Imagine a few scenarios of who might trade stuff for a smaller home:

  1. A downsizing well-off couple who wants to move to the big city now that they are empty-nesters.
  2. A recent college graduate who cannot afford a large residence but wants to spend money on cultural options and food.
  3. A professional who works long hours and does not want to care for a large residence.
  4. People who live the majority of their life through the Internet and their smartphone.

On the flip side, imagine people who might still want a larger home:

  1. A suburban couple with a child on the way who want more space for their kids.
  2. A young worker who has saved a little money, wants to put down roots in a community, and invest in something that will probably rise in value over the decades.
  3. People who like to have friends and family visit or who want to gain some extra income through hosting people.
  4. Numerous Americans who think a larger home is a better deal given that they can use the space, they like to buy stuff, and/or think that their home will appreciate in value.

In sum, I could imagine those who choose to buy smaller homes might be doing it for class/education/taste based reasons rather than just because they want a more efficient home. Those with more education might value a big home less. I would guess it will take time for many American residents to come around to the way of thinking that a smaller home is more efficient. In the meantime, there are still many forces still pushing people to buy larger homes.

Considering housing shortages and gentrification together

An MIT economist looks at the relationship between gentrification and a shortage of cheaper housing:

Unsurprisingly, the geography of a place and the community residing there are linked. Along the most measurable dimensions, richer people tend to live in places with attractive geographies. Conversely, places with undesirable attributes like industrial or transportation pollution, poor access to jobs, and uninviting climates are usually left for the poorest and most marginalized.

Usually—but not always. Occasionally, physically attractive locations come to be occupied by low-income communities, immigrant communities, black communities. Neighborhoods like these are ripe for gentrification. Changes in labor markets, large investments by public or private institutions, or even just changing preferences among the wealthy move these neighborhoods into the sight lines of richer people, and then they gentrify.

The housing shortage, meanwhile, is a region-wide round of musical chairs, in which the winners sat down before the music even stopped. Whereas gentrification reshuffles which communities occupy which parts of the city, the housing shortage can operate at the scale of cities and regions as well as neighborhoods…

Policies introduced to fight gentrification—rent control and tenant protections—may ameliorate the effects of neighborhood change, but they won’t build new homes. We must allow new construction somewhere, despite the changes this will bring. Of course, we must do so in a way that avoids gentrification.

Four quick thoughts on this argument:

1. This reminds me of my post from the other day comparing the perspective that there is not enough housing and there is plenty of housing but it is not cheap enough. This piece suggests there are multiple housing issues at work and policies might tackle one particular issue and not others (or even make other housing issues worse).

2. Does the multiplicity of housing issues require that Americans prioritize which issue matters to them most? If middle-class people want cheaper housing, that will lead to different approaches (public policies, legislation, urban planning, decisions by developers, etc.) compared to a consensus that gentrification is not desirable. Historically, Americans have tended to prioritize housing for the middle-class (broadly defined) at the expense of housing for the poor or homeless.

3. To truly address all of these issues, metropolitan-wide approaches are needed. Individual neighborhoods or municipalities are often left to tackle these on their own even though decisions by nearby neighborhoods or municipalities have significant effects on their housing.

4. Additionally, a comprehensive housing policy is needed, not just one that tackles the most important or noisiest issue at the moment. On one hand, many Americans would not want the government to become involved in such issues even as the government has promoted suburban homeownership for roughly a century.

Identifying “the wrong side of the tracks” in wealthy suburban areas

In wealthier suburban areas, where are the “wrong side of the tracks”? One writer explores this question in Chicago’s North Shore suburbs:

Pity the poor people of Wilmette. Most of them have done quite well in life. They’re doctors, academics, architects, attorneys. But they have the misfortune of living down Green Bay Road from — and sending their children to New Trier with — people who’ve done even better…

They don’t just do it in Wilmette, either. I once met a woman from Kenilworth — the second wealthiest municipality in Illinois, in one of the wealthiest zip codes in the nation — who told me, “In Kenilworth, there’s a ‘kennel’ side and a ‘worth’ side.” She, of course, was from the kennel side, presumably west of Green Bay Road, where the houses are slightly smaller.

There’s nothing more North Shore than trying to convince people you’re not as rich as everybody else on the North Shore — that you’re a member of the lower-upper class who grew up on the wrong side of the Metra tracks. Saying “I’m from the North Shore” — especially to someone whose first exposure to that world was Risky Business, Mean Girls, or Rahm Emanuel’s biography — paints a picture of elitism that many residents would understandably like to disassociate themselves from…

Sociologists would say that poor-mouthing in rich suburbs is a result of the fact that we measure our wealth not in absolute terms, but in relation to those around us. Economist Robert H. Frank conducted a study in which he asked people whether they would prefer to live in World A, a 4,000-square-foot house in a neighborhood of 6,000-square-foot mansions, or World B, a 3,000-square-foot house surrounded by 2,000-square-foot bungalows. Most chose World B.

Three quick thoughts:

1. The term hinted at in the last paragraph above is “reference groups.” Who do people tend to compare themselves to? It is often not in absolute terms but comparisons to people they aspire to be to.

2. Continuing from #1, this reminds me of some recent commentary on the top 20% or so of Americans who feel anxiety about their status and are chasing people higher up in the class ladder even as they are comfortable compared to most Americans. (See the book Dream Hoarders.)

3. Of course, there are residents of the North Shore who are not as well off. Or, suburbs without as much wealth or with significant numbers of poorer residents are not that far away. Are they even visible when the middle to upper classes are only looking at their level and above?

Amenities, ROI on housing, and social class

A recent piece linking amenities to higher return on investment for housing left unnamed a key factor: social class.

It turns out that if Trader Joe’s is nearby, your house might be worth more than if it were close to other grocery chains. The average return on investment, or ROI, for Trader Joe’s-adjacent homes is 51 percent, 10 percentage points more than the runner-up, Whole Foods (41 percent), and almost 20 percentage points more than Aldi (34 percent)…

“When we overlay points of interest (like transit, shopping, and amenities) on top of prices, we see trends in the distance to these features,” Marshall says. “In urban areas, ClearAVM has found that access to public transit has a large correlation with higher property prices. We have found the same with access to restaurants, coffee shops and groceries in urban and suburban areas.”…

Some of the positive location amenities that can impact home values and equity include high-ranking schools, hospitals, shopping centers, green spaces and being near the waterfront (think oceans and lakes), as well as access to highways and main thoroughfares.

Negative location markers include things like high-traffic and high-noise areas, crowded commercial properties, high-tension power lines or other utility easements, a poorly maintained home or neighborhood, and not being near the appealing attractions mentioned earlier, Hunt says.

While I don’t doubt these factors do influence housing values, there is a common factor that helps join them all together: the social class of residents. Grocery stores, like many other businesses, figure out where to locate at least in part on looking at the residents who live nearby. Whole Food’s is generally not going to move to a community where residents do not have the resources to pay their prices. Aldi, in contrast, appeals to a different market. Going further, think of the differences in locations between Walmart and Target, McDonald’s and Chipotle, Dollar Stores versus chain drug stores, and more.

A number of the items on the list of “positive location amenities” are also closely connected to social class. High-ranking schools tend to be in wealthier communities. The same is true of shopping centers and higher property values mean only certain kinds of residents can afford homes on the waterfront.

This does not mean that there is not more affordable housing in these areas with positive amenities. There may be. But, I would guess the zip codes connected to the higher-class grocery stores tend to be wealthier and more educated zip codes overall. The habitus of social class extends even to what grocery stores people prefer, the desired appearance of nearby homes, and close amenities that help reinforce their social class, practices, and tastes.

Trying to revive buses in American cities

A new book looks at how buses could become more viable transportation options. From the author of the book:

One of the statistics that is telling in the book is that when you look at bus ridership in a place like Germany, the people who ride the bus have the same median income as the average German. In the U.S., they’re much poorer. At the same time, it’s not a service that actually serves low-income people well at all. So is it really for them? It’s really a system for people who don’t have alternatives…

One of the biggest omissions from federal policy is that federal transportation programs are almost always about building things. But the biggest problem [with public transit] in most cities is that we don’t run enough service. You could use federal transportation funding to buy a bus, or stripe a bus lane, but you can’t use it to hire a bus operator, or dispatchers, or people who are planning bus priority projects. In the book, I write about this really bizarre set of affairs in the [2008] stimulus package, where cities all over the country were using federal stimulus dollars to buy buses. At the same time, they had to lay off all of their bus operators. That’s not really doing anything to further equity for people on the ground…

There’s a cycle between culture and reality. We design bus systems that are really inconvenient, and that only people without great alternatives will use, and that colors how decision makers think about who bus riders are. And that’s really important to disrupt.

One of the promising things you see in places that are improving bus service is how quickly it can turn around. You just provide more service in a route, and upgrade the shelters, and you see ridership increasing. We have this terrible conception of the so-called captive rider in transportation planning, when all the actual data shows that basically everyone has choices, and sometimes those choices can be pretty inconvenient, like having to get a ride with your friends, or having to walk four miles to work. Transit service can always deteriorate to the point that people are going to choose something else. But as you make bus service better, more and more people start gravitating towards it. It’s a very natural thing.

There a lot of issues to overcome in addition to the ones cited above. In my mind, buses have one major advantage over other forms of mass transit: they utilize existing roads and highways to provide mass transit. It would take a lot to reverse the American preference for driving and all that comes with it. Of course, as the article notes, buses that crawl along in traffic like cars and trucks may not be very attractive to riders and may require dedicated lanes. Similarly, buses in sprawling areas may not work as well if people are not willing to start at a common location and give up some freedom of mobility. (The discussion in the article revolves around cities but there are denser suburbs – and suburban like areas of some cities – where buses might work.)

The discussion hints at a related issue: there has to be enough bus service to be attractive but getting people to ride the bus in the first place is difficult when driving a car is a culturally preferred option as well as the option that best suits the existing infrastructure. How many local governments are willing to stick with busing even when it might not be successful at first? Furthermore, would increases in service be accompanied by changes in development policy that would seek to create housing and jobs along bus transit corridors?

Reading the full discussion, it does seem it might not be too difficult to revive bus transit in big cities. On the other hand, bus transit is a hard sell in many American communities and a long-term commitment from all levels might be needed before significant change occurs.

 

 

Maybe modernist houses will appeal to millennials – in certain circumstances

Architects and cultural critics often like modernist homes even as Americans largely do not prefer them. But, perhaps millennials will select modernist homes:

“For a while people were just tearing them down, but people are seeking them out now — they’re the anti-McMansion,” says Ellen Hilburg, co-founder of the real estate resource Mid Century Modern Hudson Valley. “For some people, it’s a nostalgia factor. But Millennials are discovering them, too. It’s an aesthetic that appeals to people who are aware and environmentally conscious.”

There are a number of pieces of this story that suggest preferences for modernist homes are tied to particular traits of the homeowner or observer:

1. A higher social class.

2. Higher levels of education.

3. Rejection of consumerism and the implied materialism and conformity that goes with it.

4. An interest in the “cool” factor of a home.

5. Living in a community – such as a wealthy, middle to upper-class suburb – where modernist homes are present and accepted.

Putting these categories together, there may indeed be a slice of Americans who prefer modernist homes. But, this also sounds like a taste connected to cultural capital, to invoke Bourdieu. In other words, expressing a preference for modernist design is connected to social class and education that not all Americans have access to.

Responding to “white suburbanites are exposed to more racial diversity than ever before”

One researcher explores the increasing racial and ethnic diversity of suburbia:

The scale of these national changes is too great to leave suburbs unaffected. As a consequence, white suburbanites are exposed to more racial diversity than ever before, a process that compounds annually. In 1980, a majority of white suburban residents lived in areas greater than 95 percent white, according to my analysis of the Census data. Only about one in six lived in a neighborhood where people of color made up at least 20 percent of the population. Fast-forward to today, and the numbers flip: Fewer than one in 10 white suburban residents lives in a neighborhood greater than 95 percent white, while more than half can be found somewhere that’s more than 20 percent nonwhite. Suburbs are now home to most black Americans and Hispanic Americans.

Nonwhite residents skew younger, which means diversity is increasing in schools even faster than in cities and neighborhoods. As that happens, the racial isolation of white children has been broken in spectacular fashion. In 1988, the earliest year with digitized federal data, more than half of white children nationwide attended a school that was more than 90 percent white. In 2016–2017, the most recent school year with data, that share dropped to less than one-fifth. In public districts today, more than three-fifths of white children attend a diverse school where at least 20 percent of the student population was not white; in major metros, nine-tenths of white children do.

Lest the point get lost in a swarm of statistics, these figures represent an inversion of America’s historic racial geography. As recently as a few decades ago, almost all white people in America lived their lives in places where racial diversity was minimal or nonexistent. This is simply no longer true. In neighborhoods and, especially, schools, moderate diversity is now the norm for most white Americans. The America where busing failed was a place where islands of urban diversity drifted in an ocean of suburban whiteness. Today, the metaphor must be reversed: An archipelago of white enclaves is embedded in a sea of growing racial diversity.

And since this discussion is in the context of debates about schools and busing, the author suggests this change in diversity has implications:

By every available demographic metric, those white suburbs are losing ground in 21st-century America. The problem of segregated schools, as urgent and familiar as ever, is embedded in a deeply unfamiliar context. School integration in 2019 means moving children across racial boundaries that are already looking ragged. The communities it risks outraging have ever-shrinking political clout. People should consider whether they have overlearned the lessons of history—whether the antibusing consensus is more robust than the conditions that created it. Integrated schools are more achievable than the political system believes. The missing ingredient for desegregation may just be elected officials with the courage to stop fearing America as it was, and start leading America as it is.

The article takes a pretty optimistic view of racial change in communities. Indeed, residential segregation has decreased in recent years with more minorities living in suburbs and increased immigration.

I wonder if the same data could be interpreted differently:

1. The cutoffs for diversity cited above are low bars. More than 20% non-white is not that much diversity.

2. The article does not discuss social class and its interaction with race and class. What kind of diversity are white suburbanites interacting with in terms of class and race together?

3. The emphasis here is on the public school system as well as communities though there are plenty of white students (as well as other students) in different schooling environments and social ties and networks can operate through many institutions. Diversity by community or neighborhood may not translate into diversity in a school setting or in local government or houses of worship or friendship networks.

4. What is the end goal of such efforts? Is “moderate diversity is now the norm for most white Americans” enough or even be used a way to limit further diversity? Is representation in public schools enough or is the goal similar academic achievement or access to political power or homeownership rates or wealth (all areas with disparity)?