Density, Walkability, Character: New Study Finds Housing Market Changing
by Peter Shelton
Jan 31, 2013 | 1312 views | 0 0 comments | 11 11 recommendations | email to a friend | print

Sonoran Institute Presents to Ridgway/Ouray Gathering

RIDGWAY – “Now that we’re coming slowly, haltingly, out of the recession, it’s not if we’re going to grow, it’s how.”

Clark Anderson, Colorado Director of the Sonoran Institute, was the featured speaker at two gatherings in Ridgway last week, bringing a message of change in the housing market, change that will be important for local governments, and the private sector, to heed.

His first talk was to a gathering known informally as the Tri-Agency Meeting – elected and appointed officials from the towns of Ridgway and Ouray, plus the county, who get together a couple of times a year for networking and face time. It was Ridgway’s turn to host, and Town Manager Jen Coates invited Anderson, who lives in Glenwood Springs, to drive over and discuss his latest project, a study of housing trends called “Reset and Recovery: Shifting Markets and Opportunities for Rocky Mountain Communities.”

A lengthy title, but, Anderson insisted, a simple message: the era of “bigger is better” – bigger single-family houses on bigger lots as far out in the country as possible – is being replaced, gradually, with demand for neighborhoods with character, safety, walkability, and urban-type amenities. “More people are willing to pay a premium for these things,” Anderson said, even in the Rocky Mountain West, the traditional home of big skies and “don’t fence me in.”

Anderson began with some sobering facts from the Standard & Poor’s Case-Shiller Home Price Index: 12 million people in the U.S. are underwater on their mortgages; housing prices are 33 percent below their 2006 peak; and despite recent upticks, the housing market is still a drag on the economy as a whole.

He quoted a National Association of Realtors study that showed decreasing demand for large-lot, single-family housing and increasing demand for smaller-lot, single-family homes, townhomes and multi-family units (shared-wall dwellings). Renting is more appealing than it was before the housing bubble burst. Walkable, mixed-use locations (residential combined with commercial) are gaining in appeal. And, finally, financing remains a big challenge for builders, especially for multi-family buildings – a sign that lenders are perhaps behind the demand curve.

What is driving the change? Anderson’s next PowerPoint slide said a lot: “The boomers are coming! The boomers are coming!” Anderson said the national study shows retiring baby boomers want to “age in place,” that is, as part of a neighborhood or community, and that they are increasingly demanding “urban-type amenities.”

(Anderson himself is a Gen Xer, a child of boomers, now in his thirties with young kids of his own. “The biggest demographic out there,” he said provocatively, is neither the boomers nor Generation X, but Generation Y, “who are young now, but will be hugely significant when they come of age. Gen Y will face real challenges getting into housing in the future.”)

Two other factors driving the change, Anderson said, are shrinking household size (Americans having fewer children, and boomers living in empty nests) and shrinking household income (see recession above). An increasing number of boomers and Gen Yers told the NAR study they were looking for “in-town” housing, with compact walkability – “smart growth, if you will,” Anderson said, and that they were willing to take a smaller place in exchange for a shorter commute.

“We’ve entered a new normal,” he concluded.

But what about the Rocky Mountain West? Isn’t the picture different out here as compared to the national outlook? “That’s what the Sonoran Institute wanted to find out,” Anderson said. So it launched its own study, focused on the towns of Eagle, Carbondale and Buena Vista in Colorado, plus Teton Valley, Idaho, and Bozeman, Mont.

And, Anderson said, their study (of 400 respondents versus 2,000 respondents for the National Realtors’ study) largely corroborated the national results.

“The single-family, detached home is still preferred,” Anderson said. Thirty-seven percent said that sharing a wall with other homeowners “carried a stigma.” But a majority said that neighborhood character was more important than house size. They endorsed the notions of “a sense of place,” of safety, walkability and proximity to things like schools and shopping. Ninety percent said that walkability was somewhat or very important. Fifty-eight percent said they would take a smaller lot if it were “closer to everything.”

So, what does this all mean for towns like Ridgway and Ouray, and for Ouray County?

Anderson had a short list of suggestions for both local governments and for the private sector. He thought local governments could respond to the trend by “catalyzing the kind of development you want, by ‘place making.’” By investing in core areas. (“You guys are poised for that,” he said referencing Ridgway’s Streetscape and Main Street plans, and it’s Creative District designation.) By sound infrastructure investment. By “allowing and encouraging housing choices.” And by insisting on pedestrian preferences – “even if that means fighting CDOT as hard as you can.”

To developers, he suggested building “places not projects.” (And here he had a couple of slides of new, mixed-use development in downtown Buena Vista.) He advised “providing pedestrian preferences. Walkability matters; if it’s only auto oriented, it cripples projects.” 

Pay heed to the “evolution of the single-family home,” he said, “away from soulless suburban style dominated by attached garages, etc.”

And finally, “location, location, location.”

“We’re not trying to sell anything with our study,” Anderson said. “We’re just saying the market is more segmented than it used to be.” People want different things now, not just “bigger and farther out. There is a trend,” he said, “for lots of reasons, including demographics and economics, toward smart growth, more density, and walkability.”

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