The Cost of Transportation is Heavier than the Cost of Home

October 8, 2006 – Vol.11 No.29

THE COST OF TRANSPORTATION IS HEAVIER THAN THE COST OF HOME.

It’s safe to say that much of America’s economic might can be traced to its extensive system of roads, highways and interstates - the pathways that cars and trucks need to operate.

Paid for by the taxpayer the pathways have created indirect subsidies for automakers and oil companies, but others certainly have benefited as well: the housing industry, the commercial real estate industry, the retail industry, the trucking industry to name a few.

Certainly there have some losers: the environment, the nation’s security, to name two. And now with the ever-expanding sprawl of the suburbs and exurbs (prosperous rural communities beyond the suburbs) families are beginning to lose out as well.

In a new study conducted by the Center for Housing Policy, the research affiliate of the National Housing Conference (NHC), low and moderate income working families who move further away from work to find affordable housing are spending as much or more on transportation to get to work than they’re saving in lower housing costs.

In 28 regions studied the findings were near universal: Families with annual incomes ranging from $20,000 to $50,000 spend on average 28 percent of their income, $9700 each year, on housing, but nearly 30 percent on transportation. Transportation included auto ownership and use, commuting and local travel as well as using public transit. (By far, in all regions, people used the auto as the main source of transportation.)

The study makes some recommendations as well: build more affordable housing near existing and planned transit hubs. Redevelop inner city and older suburban neighborhoods and bring jobs to those areas, encourage car sharing and reduce the cost of car ownership for those who must commute by car.

If transportation costs continue to rise - such as with a long term trend in rising fuel costs - those forced to travel by car will begin to fall into the hole deeper.

(There’s a flip side to the study as well, of course. Those who have found work close to home, no matter where they live, would have newfound wealth in money NOT spent on transportation: a penny saved is a penny earned. Efforts to cut greenhouse gas emissions by driving less could be a similar wealth builder.)

The comprehensive study was conducted with support from the John D. and Catherine T. MacArthur Foundation.

For the complete study, A Heavy Load: The Combined Housing and Transportation, Burdens of Working Families, visit the NHC http://www.nhc.org/