Destroying the village, part deux
Yesterday's post elicited some good comments. Fester cited Washington's Landing, Crawford Square and the Summerset housing development at Nine Mile Run as successful URA-directed redevelopment projects. I don't know enough about each to agree or disagree--though Washington's Landing certainly appears to be a gorgeous little community--but he did note some key differences with the projects I took to task; namely, more community buy-in and the fact that they were done on abandoned or underused land.
One thing I will say about Summerset is that while the city has very little new housing, it has plenty of older homes to choose from, and the homes at Summerset only cut into that market. That said, I think it's desirable for government to clean up brownfield sites and repair any necessary infrastructure to make the land attractive to private developers--but that's where government's role should end.
posted by Jonathan Potts at
6:58 PM
5 Comments:
I have to disagree with you on new housing cutting into the market of the total housing stock. Yes, in a macro sense you are right, houses are substitutes. However they are fairly imperfect substitutes. The Pittsburgh housing stock is old (from 2000 US Census, Table H-34 SF-3 dataset), with half the housing built before 1939. Throughout the country, 15% of housing was built before 1939. On the other end the 2.38% of the country's housing stock was built between Jan. 1 1999 and April 1, 2000. However Pittsburgh's housing stock that was built in this time period constituted 0.43%.
Now this is important because while shelter and housing is a substitubable good, it is not a perfect substitute. I and most people will be happier in a nice well maintained penthouse suite at Trump Towers than a hovel built in the 13th Century Germany. New houses are a different good with a different market than 60+ year old houses. There is some cross elasticity of demand, but new and really old houses are two very distinct market segments with different types of buyers and sellers.
12:34 PM
True, some people--I am not one of them, so I will concede a bias--prefer new housing stock to older homes. However, many of Pittsburgh's older homes are in good shape and can compete with newer construction.
The bottom line is still the same--government should stay out of the real estate and upscale housing business. The same principal that applies to retail applies to housing. Government can't create markets that don't exist. Perhaps new housing helps Pittsburgh compete with outer-ring suburbs. But I don't think that people who would choose to live somewhere like Upper St. Clair or Cranberry are going to want to live in the city anyway. And we need to remember that our entire region, not just the city, has been losing population. My fear with places like Summerset is that we create a housing glut, depressing property values and leaving us with a lot of empty houses. I hope I'm wrong.
12:47 PM
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12:48 PM
Jonathon Potts said And we need to remember that our entire region, not just the city, has been losing population. My fear with places like Summerset is that we create a housing glut, depressing property values and leaving us with a lot of empty houses. I hope I'm wrong.To me, this is not a particular worry because even though the region is losing population it is not hemorraging population where a housing glut will become a problem. That has already happened within the city of Pittsburgh and the inner ring suburbs as 50% of the population left in two generations. Pittsburgh needs new housing if for no other reason than to replace the structurally dangerous and functionally obsolete housing stock. And the rate of construction is so slow on new housing within the city limits, that it could triple and still allow for a net decrease in the number of units on the market after we take into consideration the retirement, demolition and abandonment of older properties.
1:06 PM
Given that the area has declined 50% in two generations, is there any wonder that the housing stock is so old? The solution is to build government housing where there is no demand? Time to make sure that there are nice new chairs on the deck of the Titanic. Surely, there are better ways to squander tax dollars?
3:19 PM
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