Houston, One of the Most Affordable Cities..Or Is It?

Houston lists among the most affordable cities in the U.S., according to a survey that was released recently. But critics of the survey say the report is misleading. From the KUHF NewsLab, Wendy Siegle reports.

Type housing affordability into your search engine and the 2010 Demographia International Housing Affordability Survey will be near the top of the list. The survey is put out by a New Zealand commercial property developer in cooperation with Demographia and looks at 272 urban housing markets in Australia, the UK, Canada, Ireland, New Zealand and the US. The report evaluates affordability by dividing the median house price by the median household income.

“Houston was one of the most affordable major metropolitan areas.”

That’s co-author Wendell Cox. He says Houston has always been pretty affordable, even at its peak during the housing bubble and even though it’s a high demand market. It seems the data bodes well for Houstonians, right? Well, it may be more complicated than that. Critics say the data itself is flawed.

Here’s Jay Crossley from Houston Tomorrow:

“The way they assess affordability is too blunt an instrument to yield meaningful conclusions, because it ignores things like transportation costs and other particulars of our region, and our people’s actual lives.”

There’s also a lot controversy over the conclusion of the report, which names one reason for why some markets are affordable and some are not: it all comes down to zoning.

“Quite frankly it is very clear, and this has been confirmed by all sorts of economic research from all over the world, the factor that raises housing prices above the norm is overly strict land-use policies which also go by the terms smart-growth or growth-management.”

Generally, smart-growth advocates mixed land uses, walkable neighborhoods, diverse housing options and preserving open space. Think Montrose or satellite cities that become self-sustaining over time like the Woodlands or Sugar Land. Cox says this restrictive land-use philosophy increases housing prices by limiting how and how much land can be developed. Supporters of smart-growth say the survey doesn’t address what people really want in their living environment.

This is Houston Tomorrow’s David Crossley:

“The millennials and the seniors, the whole boomers that are growing, you know me, are really not interested in sprawl. They’re interested in living in the city and they’re interested in having access to theater and so forth and being able to take a bus or train to get there and not mowing yards and fixing gutters and all that.”

Which brings us back to the affordability issue: Can city planners develop these so-called livable centers without hiking up Houston’s housing prices?

Dr. Barton Smith, the Director of the University of Houston’s Institute for Regional Studies, says Houston’s housing market is open to various types of housing, but predicts one thing for sure.

“We’re going to see more and more of these satellite employment centers that will make it easier for us to commute, easier for us to get around Houston, without these enormous commutes and filling up our freeways.”

One thing is certain; Houston is a city where passions run high among advocates on both sides of the fence. The city’s urban planners hope having a number of different options will give Houstonians the choice of living where and how they choose.