Interesting article on transportation costs (Pittsburgh, Plum: real estate, insurance, houses)

[BrianTH]

Home buyers don't factor in commuting

Some key excerpts:

Buyers who move deep into the suburbs to find bigger, nicer houses often fail to consider added transportation expenses that might bust their budgets, a new national study has concluded. Rising transportation costs are dramatically shrinking the amount of affordable housing in Pittsburgh and across the U.S., according to the report released today by the nonprofit Center for Neighborhood Technology, a group that promotes more environmentally conscious policies. Based on housing costs alone, 72 percent of neighborhoods in the Pittsburgh metropolitan area would be considered affordable to those making the median income. But when transportation expenses are factored in, the number drops to 32 percent.
. . .
One recommendation is mandatory disclosure of the average transportation cost for a neighborhood as part of the home-buying process. "Americans will make a better housing decision by having more information," said Ron Sims, deputy secretary for the U.S. Department of Housing and Urban Development, at a briefing Tuesday unveiling the study.
. . .
The report cited a "drive 'til you qualify" trend that pushes people farther away from core cities and employment centers to find housing they can afford. Drawing contrasts in the Pittsburgh region, it said a typical family living in Lower Burrell in Westmoreland County spends about $400 a month more on transportation than one in the Duquesne Heights section of Mount Washington. Transportation costs eat up nearly 26 percent of the typical household budget in Harrison, 19 percent in Dormont and less than 15 percent in the Crawford Square community in the lower Hill District, the report said.
. . .
In interviews Tuesday, local real estate professionals said that while most prospective buyers place a premium on location and convenience, they rarely do the math on transportation expenses. . . . Linda Carnevali, regional manager for Prudential Preferred Realty, said in 23 years she had never seen a prospective buyer compute transportation costs.

Some of the recommendations for housing and transportation policy are likely to be controversial, but the bits about calculating and reporting average transportation costs seem pretty straightforward to me.

[xtant64]

There are a couple factors to figure in here though. I live in Plum for example and take the HP in to work. I drive to a Park and Ride about 2-3 miles from my house, and pay $105 per month to ride a bus into work. I'm not that far off from Lower Burrell in distance, and I'm almost 1/4th the cost that they list.

[Geeo]

I guess part of this depends on how far they live from where they work. If you live in Cranberry and work at Westinghouse, then your costs for commuting wouldn't be as high. But perhaps people should also take into account how far everything else is that they have to drive to: grocery, school, shopping, etc. Since the bulk of the jobs in the region are in the city, it would stand to reason that the further out the average person lives, the more they would spend per month, which would negate the advantage they see of living in a county that has lower taxes, when they're really probably spending more.

[Copanut]

That's why I love having a home office. 19% in Dormont, seems awfully high to me.

[hempfield mania]

Their numbers don't take many factors into consideration. Yes, they compare property taxes and transportation costs but, what about living in the city limits (Duquesne Heights) vs Westmoreland or Washington Co. or even farther out in Allegheny County and factoring in wage taxes. Wage taxes being 2% higher within the city limits pretty much negates any reduction in transportation costs (assuming the person will still own a car, just use it less). The more you make, the better off you are living outside the city. Also, insurance rates for housing and transportation are typically higher for people living within cities. Many times, utilities are also more expensive in the city. And for an avid outdoorsman like myself, quick access to vast expanses of green space is priceless.

In my current location, I have enough space to grow a decent size garden and can save a lot of money through out the year on fresh veggies and with canning. I also have enough space to work on my own vehicles (many times you don't have the space or aren't allowed to work on cars within the city) saving LOTS of money.

[BrianTH]

Originally Posted by hempfield mania

Wage taxes being 2% higher within the city limits pretty much negates any reduction in transportation costs (assuming the person will still own a car, just use it less).

Obviously taxes count too, but the study is suggesting that for many people the difference in transportation costs is adding up to considerably more than 2% of their income. As an aside, the number of cars per household can be a variable. So, for example, a couple might share one car instead of having two, which results in savings. If you have something like Zipcar available, you may well be able to use cars on a regular basis without personally owning one at all (which is sort of like fractional ownership of cars).

The more you make, the better off you are living outside the city.

It is probably true that transportation costs don't scale up completely with income, although they likely do a bit as people buy nicer cars and such.

Also, insurance rates for housing and transportation are typically higher for people living within cities. Many times, utilities are also more expensive in the city.

Obviously all this counts too, but I am not sure where you are getting this data.

And for an avid outdoorsman like myself, quick access to vast expanses of green space is priceless. In my current location, I have enough space to grow a decent size garden and can save a lot of money through out the year on fresh veggies and with canning. I also have enough space to work on my own vehicles (many times you don't have the space or aren't allowed to work on cars within the city) saving LOTS of money.

Yeah, I don't think the argument is that no one should live in rural areas, exurbs, or so on. But at a minimum people should be aware of the associated transportation costs before committing to buying a place, and we may also want to look at whether everyone is making that choice freely or if instead some people are forced into that choice because of land-use regulations, inefficient transportation planning, and so on.

[Craziaskowboi]

Not everybody works downtown, though. Monroeville, Robinson and Cranberry are emerging as significant employment centers. If your job is in Monroeville, then living in Murrysville won't bust your wallet when it comes to commuting expenses. Same with living in Moon and working in Robinson.

[BrianTH]

Originally Posted by Gnutella

Not everybody works downtown, though. Monroeville, Robinson and Cranberry are emerging as significant employment centers. If your job is in Monroeville, then living in Murrysville won't bust your wallet when it comes to commuting expenses. Same with living in Moon and working in Robinson.

Absolutely. Potential buyers should definitely adjust for their actual working situation.

[hempfield mania]

There is no way their numbers shown here are correct.

"Transportation costs eat up nearly 26 percent of the typical household budget in Harrison, 19 percent in Dormont and less than 15 percent in the Crawford Square community in the lower Hill District, the report said."

Sounds like a study with an agenda and that is all.

They are telling me that someone with say an avg. income of $45,000 living in Harrison is spending close to $12,000 per year on transportation related costs. NO WAY. And as you elevate the income (which tends to rise when you get out in some of the well to do burbs) the percentages seem even more ridiculous.

[gameguy56]

Originally Posted by hempfield mania

There is no way their numbers shown here are correct.

"Transportation costs eat up nearly 26 percent of the typical household budget in Harrison, 19 percent in Dormont and less than 15 percent in the Crawford Square community in the lower Hill District, the report said."

Sounds like a study with an agenda and that is all.

They are telling me that someone with say an avg. income of $45,000 living in Harrison is spending close to $12,000 per year on transportation related costs. NO WAY. And as you elevate the income (which tends to rise when you get out in some of the well to do burbs) the percentages seem even more ridiculous.

Many of these 'well to do' burbs also have higher property taxes than the city of Pittsburgh.