HUD and DOT launch housing and transportation cost calculator

The Location Affordability Portal (LAP), developed by US departments of Transportation (DOT) and Housing and Urban Development (HUD), allows users to estimate housing and transportation costs for neighborhoods and towns across the US. It demonstrates the significant affordability advantages of "car optional" neighborhoods relative to distant suburbs.

This technology was first developed by the Center for Neighborhood Technology with their Housing and Transportation Affordability Index (the H&T Index). The H&T Index does more — like calculate carbon emissions and block size by location — but the HUD/DOT tool is much easier to use for ordinary citizens. It may put another nail in the coffin of the "drive-'til-you-qualify" mentality of house shopping.

Users can simply click on an neighborhood across the US and get average housing costs, transportation costs, and incomes. These numbers will vary according to individual household circumstances, but the averages show that location sets important parameters.

When considering affordability of a place, households have tended to consider housing costs in isolation. But this tool makes clear that transportation costs vary almost as much as housing costs — and in a more predictable fashion. In walkable places, the typical household often saves $6,000 to $7,000 per year in transportation costs compared to drive-only suburbs. Those are after tax expenditures — saving that amount is the equivalent of making an extra $10,000 a year. Plus, living closer to downtown, a household has better access to jobs.

In some metro areas the savings may not be that dramatic, but they are still substantial. Due to transportation cost savings, walkable neighborhoods tend to be significantly less expensive in metro regions nationwide. In order to get those savings, households will usually have to give up the large yard — but they may gain cultural and social amenities in exchange. Households must weigh many factors, and the right answer will depend on the individual household, yet LAP enables families to better understand the cost implications of locational choices.

“I've witnessed the evolution of these tools over time and I'm impressed by the attention to detail and statistical sophistication,” said Tom Sanchez, Virginia Tech professor and Editor of the academic journal Housing Policy Debate.  “Household location decisions are in fact a function of housing costs and transportation costs together.  Better information should lead to better decisions that effect not only particular households, but also communities and regions.”

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