A few years ago, the Center for Neighborhood Technology gave a wonderful gift to urbanists and planners: the Housing + Transportation Index. This simple calculation clarified and popularized a key concept: that transportation costs must be taken into account in any measurement of “affordability.”
Without that, potential homebuyers and renters make the mistake of “saving” money by buying a home far outside the city, only to see those savings vanish when they end up driving multiple cars hundreds of miles per week, racking up fuel and maintenance expenses. The H+T index is a simple tool for making better decisions — for families, for planners, and for the federal government.
Today, U.S. DOT and HUD announced that they’re launching a new version of H+T. They’re calling it the Location Affordability Index, and CNT helped develop it. LAI differs from H+T in some key ways (here’s an infographic detailing those differences) but at its root, it gets at the same important question: Where is the best place to live without breaking the bank?
CNT answers that question by showing the huge variations between two maps: one that shows places where the median household pays 30 percent or more of their income on housing, and one that shows places where those households pay 45 percent or more of their income on housing and transportation combined.
The maps show how intimately linked transportation and housing are when determining cost of living, as HUD Secretary Shaun Donovan told reporters today. “For any housing community to succeed, its residents need to be able to get to work, its young people need to be able to get to school, and its families need to be able to access critical resources and services they need,” Donovan said.
Donovan noted that for most families, transportation is their second-highest monthly expense, after housing, but said transportation costs aren’t always so easily tabulated. You don’t get one transportation bill in the mail, the way you get your mortgage or rent bill. Transportation costs are paid in dribs and drabs — a tank of gas here, a bus fare there, a parking ticket, a taxi ride, an oil change. The LAI index helps quantify how those costs add up, and see if the transportation requirements of a particular geographic area render it unaffordable.
“It can sometimes be tricky to weigh the pros and cons of all of these options,” said Transportation Secretary Anthony Foxx. “Does it make more sense to live in a community where you have to drive to work every day? Or might it be a better bargain to live where you can walk, bike or ride public transportation? That’s where the Location Affordability Portal comes in.”