Have I mentioned that I think Ryan Avent is one of the most articulate thinkers about urban economics? His recent series of posts about zoning and sprawl are outstanding. Let's begin with this:
What is clear from price data, however, is that there is unmet demand for walkable neighborhoods. Homes in walkable neighborhoods are expensive, and not because those homes cost a lot more to build. Homes in safe walkable neighborhoods are really expensive. And homes in safe, walkable neighborhoods with good schools are mind-blowingly expensive. Some people prefer to live in low-density neighborhoods. Price data suggest that many, many others would love to live in walkable neighborhoods but simply can’t afford to, because it’s difficult to build them.
The extreme example of this phenomenon is Manhattan, which is both the most walkable and the most mind-blowingly expensive place in America. And still, plenty of people live there.

(from Flickr user matt.hintsa)

I think if you ask people about why they wouldn't want to live in Manhattan, one primary answer would be that housing is too expensive, or that the housing you get is too small or too old for what you pay. This suggests two things. Either a) if housing prices in Manhattan were lower, people who wouldn't live there because of affordability would and b) if residences were larger and nicer, the same might be true, as people perceive they get "more housing for the money."

What people really want is to live in a home like the White House - a safe and huge mansion with a yard, but also in a city surrounded by valuable amenities. Oh, and they want it for as little money as reasonable. But you can't plop a bunch of those types of houses into Manhattan because, if you did, it would cease to be Manhattan.

Not liking a place because of its price doesn't necessarily mean people don't like the place because of its build environment. One reason why Manhattan is so expensive is because there are so few places like it. So if we want to bring down the prices in Manhattan, we don't do it by building "cheap" housing in the suburbs and exurbs or even necessarily by cramming more housing units into Manhattan; we do it by building more dense urban places that can compete on the same environment and amenities.

2 comments:

    All good points but I think you're forgetting something about Manhattan: it's the business and media capital of the world or at least the West. That plays a major role in attracting people to live there. I think that less people would pay the high prices to live in Manhattan if it was dense and sprinkled with good schools but lacking in that business-Mecca aspect.

     

    The density is mostly why it's the capital. Hello, great cities exist as place to trade and collaborate.

    Try hooking up 15 business meetings in one day in Dallas.