By Ryan McGreal
Published April 17, 2012
For the past several years, a number of indicators have suggested that North America may be on the threshold of an epochal migration from the suburbs and exurbs back into the cities. Like the postwar migration out of cities, this one will be driven mainly by the intersection of economics and demographics, with a generous helping of public policy.
Here's a smattering of vectors:
The share of 16- to 19-year-olds with driver's licences has been declining steadily for years, and the trend continues as people age into their 20s. Many young people see automobiles not as a ticket to freedom, but as a cumbersome, expensive activity that interferes with their connectivity.
A number of experts believe we are at or near peak car, triggered in part because the ever-growing commuting distance caused by low-density single use development has crossed a threshold of tolerability.
Like young people, aging Boomers are increasingly looking to move into compact, walkable communities that are close to amenities, either in small towns or in city centres.
Exurban house values in the USA stalled during the long run-up in gas prices over the past decade, crashed with the economy, and have not recovered.
Yale economist Robert Shiller recently proposed that suburban home prices may not recover from the 2008 crash. "Dispersed, suburban housing might not do well in decades to come. ... It could be that we're never, in our lifetime, going to see a rebound in these home prices out there in the suburbs."
Even in cities that have thrived (or rebounded) through the postwar period, migration patterns are trending back toward the city: the number of people migrating from the core to the suburbs is decreasing, while the number of people going in reverse is increasing.
Similarly, even where population has continued to grow in suburban areas, those suburbs are increasingly being built in walkable form in homes that command market premiums reflecting their demand.
Underlying all of this, the rate of oil production is at an historic global peak, which is causing oil price volatility and ongoing economic insecurity. (Former CIBC World Markets chief economist Jeff Rubin argues that the 2008 global crash was ultimately caused by high oil prices that brought down the financial bubble in mortgage securities.)
In short, the special set of economic, cultural and political circumstances that made mass surbanization both desirable and for the first time possible in the decades after WWII are waning.
Another change is that economists have finally figured out that cities are the engines that propel economic growth and development.
That understanding, articulated in groundbreaking work by Jane Jacobs (who famously proposed in her 1969 book The Economy of Cities that the innovations powering agriculture actually originated in cities and propagated outward), is now well-supported by several avenues of research.
As this understanding migrates from academia into governance, politicians are warming to the idea that cities need to be cultivated to generate the wealth that voters expect and demand.
Suburbanization is not merely a staggering cost centre in terms of energy and infrastructure productivity. Over the longer term, it also tends to undermine economic viability by denying the kinds of personal connections and shared innovations that create value and generate employment.
Here in Hamilton, the 2011 census demonstrated continued growth of the city's suburban fringe, but also a significant population rebound in several downtown neighbouroods.
For now, the city's public spending, policy and regulatory apparatus still strongly promote suburban expansion: fast approval for residential greenfield development, artificially low development charges that incentivize sprawl, labyrinthine bureaucracy and fees for adaptive reuse and infill development, a tax rebate for vacant properties, low intensification targets for the downtown compounded by anti-density FUD, hundreds of millions of dollars on a new municipal highway, and a massive boundary expansion that will also cost the city hundreds of millions of dollars.
Meanwhile, a potentially game-changing investment in light rail transit is clouded by provincial vacillating over its rapid transit investment strategy, compounded by mixed signals from the city.
It's entirely possible that we could continue to tread water on these issues and a continental migration of people, businesses and money back into cities could pass over Hamilton.
While sprawl apologists might console themselves that Hamiltonians don't want density and city living after all, the practical result during a period of turbulence would be a city left behind - a city resigned to missing out on the process of economic renewal as its traditional industries wane and its most ambitious residents leave for more dynamic, more promising cities.
It is not beyond the pale to imagine a possible future in which Hamilton follows the death spiral of many other rust belt cities dominated by waning industries: inefficient, crumbling infrastructure, sharp inequality, declining population, decaying social cohesion, abandonment and despair.
We're by no means circling the drain today, and we have many reasons to be optimistic about the future. Yet we absolutely cannot afford to receive the message about how urban economics work and then fail to apply those lessons to our own city governance.
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