A very nice article from the perspective of the folks engaged in this complicated work, from New Geography.
In the housing industry, land planners are the first to be dropped during a downturn… and the first needed in an upturn. A good way to monitor the optimism of the housing development market is to monitor the volume of land planning.
The land plan is the beginning of a long and arduous process. Unlike architecture, which is relatively quick from design to construction, land planning takes patience. It can easily consume a year or two (or more) for a US neighborhood to go from the initial design stages to the beginning of construction.
Typically, but not always, national recessions coincide with downturns in the construction industry. For example, housing growth in the Minneapolis region leaped to the far outer suburban regions because we had an urban boundary that raised raw land prices and made unsubsidized affordable housing within the core unattainable. To get a financially attainable home for a middle-class family meant a 30 mile trek to the suburbs, typically in that shiny new gas guzzler SUV….
In the 45 years that I’ve been in the planning, engineering, and software side of land development, I’ve continually read about the death of the suburbs and the major change in the housing market. Most of the predictions have proven to be false. Terms like ‘cocooning’ and ‘clustering’ failed to catch on, and are no longer commonly used.
More recently, I’ve seen a projection that 50% of all households will be single person entities in the not too distant future. I’m from the hippie generation. If, in 1969, forecasters judged that we represented future housing needs, everyone would surely have foreseen an upcoming growth in communal neighborhoods, marriages with multiple sex partners, and children raised in flower gardens. Yet most of our generation grew to be conservative, short haired, well behaved, religious suburbanites and business leaders.
I’m certainly not an economist, a demographer, or a professor, but my projection is that the idealistic young people of any generation will eventually marry and desire (for the most part) a home with a yard in which to raise their children. A home they are proud to pull up to in a neighborhood that is beautiful, safe, connective, and functional. In addition, I believe that they will want a lower-maintenance home that consumes little energy for heating and cooling. That home could very well be in a redeveloped urban environment, or in a suburban setting.
Those that qualify for a mortgage today want to arrive at an individual home that elevates their sense of self-worth, especially after experiencing the recession. Instead of a 10mpg SUV, they are likely to drive home in a vehicle that gets three to five times that efficiency, making the cost per gallon not so critical, even if we go beyond five dollars a gallon.