Economy – Real Estate Link

Economy – Real Estate Link

Mass transit helps the economy by increasing residential property values

Do you own a house? If you do, do you find it nice when the value of your property increases? Is the value of your home something you are counting on to provide for your old age? (Sorry to keep harping on that, but it does happen, you know.) In city after city, rail transit has been shown to add substantially to residential property values. ● A study of “gentrification” in Chicago, which looked at the value of residential property served by either CTA (Heavy Rail) or Metra (commuter rail), states that “evidence is found that properties closest to transit stations increased in value much more than those farther away, especially in the period 1985-1991. Properties adjacent to transit stations had a 20% higher increase in value compared to those located a half-mile away . . .”46 ● A look at the impact of San Francisco’s BART Heavy Rail system on residential property values found that “the average Alameda County home is worth about $3,700 less for each mile distant from a BART station. The average Contra Coast County home is worth about $3,200 less for each mile distant from a BART station.”47 ● “A 1993 study of the Eastside Metropolitan Area Express (MAX) light rail transit line reviewed the impacts of rail transit to property values in suburban Portland . . . Portland’s experience is generally consistent with the results of the studies in other areas. Within the 2 years after the 1986 beginning of the operation of the rail line, residential properties in the East Burnside area within 500 meters of the transit were, on average, 10.6% greater in value than homes outside 500 meters.”48 ● A study of properties served by Dallas’s new DART Light Rail system found that “The largest increase in residential property values was seen at the VA Hospital station, where values rose 65 percent.”49 ● In Massachusetts, “An analysis of the data shows that the median price of single-family homes nearly doubled in 19 communities after they gained MBTA [commuter rail] service. Brockton, for example, which got three commuter rail stops, had one of the biggest increases in median family-home price: from $71,503 in 1995 to $194,000 in 2002 – up 171 percent.”50 ● According to the Los Angeles Times, “In less than a decade, ‘you could see 5% to 10% premiums,’ said Larry Kosmont, a Los Angeles-based real estate consultant. ‘If you have access to transportation, it is considered a benefit.’”51 19 Of course, transit, even rail transit, is not a magic wand. If a neighborhood is overrun with crime, split in half by a roaring freeway or downwind from the sewage plant, adding rail transit service is not likely to do much for residential property values. But if a nice neighborhood is given commuter rail or Light Rail, local homeowners will probably benefit, in some cases substantially so. And they never have to ride the train to pocket the money.

Congestion Internal Link

Congestion hurts economic growth

Pollard, 4’ – Senior Attorney and Director, Land and Community Program at Southern Environmental Law Center (Trip, “Article: Follow the money: transportation investments for smarter growth,” Temple Environmental Law & Technology Journal, Spring, 2004, 22 Temp. Envtl. L. & Tech. J. 155)//AWV

Current transportation and land use patterns also threaten the long-term health of regional and local economies. Congestion costs were estimated to top $ 69.5 billion in 75 large metropolitan areas in 2001 due to lost time and wasted fuel, hurting both individuals and businesses. n13 A national report found that business leaders "increasingly are concerned that sprawl is making it more difficult to access, attract, and maintain a qualified workforce," and the Metro Atlanta Chamber of Commerce has noted that "growing traffic congestion now threatens the quality of life and economic vitality of the entire region." n14 Although transportation improvements can promote economic development, there is strong evidence that new roads typically shift growth from one area to another rather than create new development. A new bypass, for example, may fuel new construction and development, but at the expense of existing towns, communities and even older suburbs by luring investment, jobs, and residents away from the bypassed community to outlying areas. n15

Congestion decreases GDP, productivity, and jobs

Lovaas, 11 – Natural Resources Defense Council (Deron, “New Report: Failure to Invest in Transportation Infrastructure Will Cost Jobs, Shrink GDP,” 7/28, http://switchboard.nrdc.org/blogs/dlovaas/new_report_failure_to_invest_i.html)//DH

In a new report released this week (covered by streetsblog and the WashPost among other outlets), the American Society of Civil Engineers (ASCE) takes a closer look at how our deteriorating surface transportation infrastructure – which earned a “D” grade from ASCE in 2009 -- affects American families, businesses, and our national competitiveness. As you might guess, it’s not pretty. ASCE calculates that the impact of deteriorating roads, rails, bridges and transit amounts to 870,000 jobs lost and $3.1 trillion in GDP lost by 2020. Crumbling, congested roads and a lack of transportation options means American families and business are spending more time, using more fuel, and spending more money to get where they need to go. One interesting note for the large amount of traffic on interstate highways in urban areas -- 47 percent of that traffic is on deficient roads, versus only 15 percent of rural interstate traffic. And no matter where you happen to be traveling, the longer we delay infrastructure improvements, the worse it gets. By 2020, ASCE calculates, American businesses will be spending an extra $430 billion on transportation costs, leading to a lag in productivity, a drop in exports, and the loss of hundreds of thousands of jobs. Families would see incomes drop by $7,000 over that 10-year period. Knowledge workers, who have grown into a key part of our advanced economy, would suffer -- by far -- the most. An economist involved with the study tells me that three reasons underpin this finding:

1. 
   Lower business income due to lower productivity and more income diverted to transportation costs requires cutting back on hiring and other productivity-enhancing investments;
   
2. 
   Less household income means fewer purchases of electronics and professional services; and
   
3. 
   Commuting difficulties create more workplace inefficiencies, especially in high-wage sectors.
   

The upshot: We can’t afford NOT to invest in transportation. The costs to our economy, especially in high-wage industries, are simply too high. This report adds to a number of studies which have come to the same conclusion. Even conservatives agree that we need to invest in our national transportation infrastructure, not cut it off at the knees. How, in these fiscally constrained times, do we move forward? We need to design a transportation program with clear, national goals, which includes an oil-savings target and prioritizes critical repairs and maintenance. We need to find new ways to generate revenue for infrastructure projects, through tools such as an oil-security fee and an infrastructure bank. And we need to ensure that our investments are smart, performance-based choices that will make the best use of limited funds.

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