The Housing + Transportation Affordability Index, developed by CNT and its collaborative partners, the Center for Transit Oriented Development (CTOD), is an innovative tool that measures the true affordability of housing. Planners, lenders, and most consumers traditionally measure housing affordability as 30 percent or less of income. The Housing + Transportation Affordability Index, in contrast, takes into account not just the cost of housing, but also the intrinsic value of place, as quantified through transportation costs. Click here to explore how this looks in 52 metropolitan areas in the US.
This work is a project of the Brookings Institution's Urban Markets Initiative and is the most comprehensive study-to-date of the Housing + Transportation Affordability Index. The Index completed for the Brookings Institution has been released in two parts. The first phase was released in January 2006 and specifically examines the variables that inform Housing + Transportation costs in St Paul/ Minneapolis, MN. The key to this report is the finding that the three primary dependent variables in the household transportation model are auto ownership, auto use and transit ridership and that the two primary independent variables are residential density and household income. The Brookings Housing + Transportation Affordability Index Phase I paper can be found here. The second phase of the Brookings project models neighborhood-level data for 52 different metropolitan areas with results available through an interactive mapping website. The Index has received much attention from policy makers for its benefits to planners and TOD advocates and has already served as the basis for various other research projects (described below).
Housing Costs
Housing costs are quantified from the 2000 US Decennial Census. This is specifically calculated through a weighted average of the "Gross Rent as a Percent of Income" and "Selected Monthly Ownership Costs as Percent of Income" fields. As defined by the US Census Bureau, "Selected Monthly Owner Costs" are defined as:
"Selected monthly owner costs are the sum of payments for mortgages, deeds of trust, contracts to purchase, or similar debts on the property (including payments for the first mortgage, second mortgage, home equity loans, and other junior mortgages); real estate taxes; fire, hazard, and flood insurance on the property; utilities (electricity, gas, and water and sewer); and fuels (oil, coal, kerosene, wood, etc.). It also includes, where appropriate, the monthly condominium fees or mobile home costs (installment loan payments, personal property taxes, site rent, registration fees, and license fees). Selected monthly owner costs were tabulated separately for all owner-occupied units, specified owner-occupied units, and owner-occupied mobile homes and, usually, are shown separately for units "with a mortgage" and for units "not mortgaged."
And "Gross Rent" is defined as:
"Gross rent is the amount of the contract rent plus the estimated average monthly cost of utilities (electricity, gas, and water and sewer) and fuels (oil, coal, kerosene, wood, etc.) if these are paid for by the renter (or paid for the renter by someone else). Gross rent is intended to eliminate differentials which result from varying practices with respect to the inclusion of utilities and fuels as part of the rental payment."
Transportation Costs
Household transportation costs are much harder to quantify than housing costs. The Housing + Transportation Index predict the average household transportation costs based on both environmental variables and household variables. This prediction was made through a regression analysis, which uses eight input variables to predict three output variables. The following shows the overall structure of the model.
Grouping Metropolitan Areas
The model looked at auto ownership, transit use for journey to work, household density, and income for each region to develop a nomenclature for transportation demand. The result was a clustering around six regions. The following graph show in just two dimensions, density and auto ownership, how this clustering happens. The most representative MSA from each cluster is determined as a prototype region; Atlanta, Chicago, Memphis, Buffalo, Ft. Wayne, and New York City, and every other region is classified accordingly. The prototype regions serve as the basis for developing the exact equations that predict household transportation costs. Read this to find out more how the regions cluster themselves.
How Metropolitan Areas Compare
The regions are more alike than one might think. In the graph to the left it appears as though more dense cities (i.e. New York, Honolulu, Chicago) have lower rates of auto ownership and less dense cities (i.e. Fort Collins, Fort Wayne) tend to result in higher rates of car ownership. That is, the graph to the left makes the argument that residential density informs car ownership. At the same time, by examining the same relationship of auto ownership and residential density at the neighborhood scale in contrast to the metropolitan scale, as in the graphs below, it becomes apparent that auto ownership and residential density are directly correlated in each modeled metropolitan region, regardless of that region's overall density. Put another way, the graphs below demonstrate that all fifty-two metropolitan regions share the same relationship between urban form and auto use. While metropolitan regions differ, at the neighborhood scale household behavior is highly determined by neighborhood conditions and urban form rather than overall metropolitan characteristics.
