Tag Archives: ann arbor

Provo Homes are Pricey

Over the last few posts I’ve argued that Provo needs more housing for young professionals and families. But just how easy is it for people in those demographics to pay for housing?

Returning to the census data I’ve referenced before, I found that the median value of an owner-occupied home in Provo is $212,400. Among the four other cities I’ve used in past comparisons — Boulder, Ann Arbor, Chattanooga, and Ogden — that figure most closely resembles the median home value in Ann Arbor, which is $240,400.

According to these figures, Provo is right in the middle of the pack when it comes to home values. And that’s a lot better than previous comparisons, where Provo came up as an outlier for its poverty and low wages. It’s better to be average than awful.

But there are a few issues going on here. For starters, this graph from a previous post shows that Provo has a low median income compared to other cities, as well as compared to each city’s respective state:

The blue bars in the graph above represent median income in each city, while the red bars represent median income in those cities’ respective states.

Taken together, these two graphs indicate that Provo has a lower income but potentially higher housing costs than other, comparable cities. That means it might actually be easier to buy a home in a place like Ann Arbor than in Provo.

Houses in the Maeser neighborhood.

The reasons for this housing situation are complex and certainly have to do with BYU and the large student population. (But again, keep in mind that all of the cities in the comparison are college towns.) BYU also has a particularly byzantine and economically detrimental housing policy as compared to other universities, which distorts Provo’s housing market in downtown.

But I’ll save causal issues for later posts.

For now, it’s particularly worth noting the high median home values in Boulder, which come in at a remarkable $475,200. Boulder is very frequently compared to Provo — by myself and others — but these figures show that such comparisons are really kind of like looking at apples and (solid gold, diamond encrusted) oranges. The point is that Boulder is significantly richer than Provo and the disparity between the two cities’ wealth helps explain the very different realities on their respective streets.

In any case, it’s worth keeping in mind that housing values in Provo are yet another economic condition that make Provo… unique. Generally speaking, this situation is a function of supply and demand for housing and if nothing else the figures are actually reassuring: clearly there is demand for housing in Provo but not enough supply to depress values.

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Mo’ People Mo’ Money

Continuing the series on wealth and city success (see previous posts here and here), I decided to look at the number of people per square mile, or population density, in five cities. Specifically, I was curious if other cities in Provo’s class had higher or lower densities.

What I found was an apparent correlation between density and income:

In the graph above, density is plotted along the Y axis while income is plotted on the X axis. As is clear, the higher the density the higher the median income. Here are the actual numbers:

This data — which isn’t surprising — offers clear procedural guidance: if Provo wants a thriving economy and downtown, it should increase density. The standard justification for that argument is that adding people means more customers for local businesses. That’s true, but as this data shows those people will also earn more as they cluster into tighter areas. In other words, higher density provides the duel benefits of more customers with more buying power.

Of course, I’m not arguing that density by itself causes higher income. And there are plenty of high density-low wage places in the world. Instead, I’m saying that in a city like Provo there appears to be a correlation between density and wealth. Embracing density also clearly won’t turn medium-sized American cities into third-world slums.

Census data shows a correlation between density and median income. That means Provo needs to do more than add buildings like this downtown, as wonderful as they are.

Perhaps an analogy — which I adapt liberally from Jon Huntsman’s view on climate change — might be helpful: Imagine having cancer and hearing a doctor say “everyone who tried this one treatment survived and everyone who didn’t died.” Would you try that treatment?

That’s sort of what is going on here; cities resembling Provo that try more density are generally prospering. At a fundamental level it’s very simple.

Thankfully, Provo is adding density in downtown. The neighborhood planning efforts are also helping residents understand the problems with sprawl-inducing policies like parking minimums. All said, Provo is doing well.

Still though, we could be doing even more. Sure, there are residential projects going into downtown, but where is the infill in historic neighborhoods? Where are the pocket developments in the more suburban areas? Where are the sweeping code changes that allow for actively encourage denser development? In the end, my friends, baby steps aren’t going to cut it in the neighborhoods.

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Filed under Development, economics

Poverty Levels in Provo Are Too High

Earlier this week I reported that Provo’s median income is lower than the cities to which it is most often compared. And though the situation may be improving, that still means residents have less money to spend in the local economy, among other things, which naturally translates into a comparatively depressed commercial sector.

But the bad news doesn’t stop there.

Perhaps the most alarming figure in the census data is the number of people in Provo living below poverty level: 31 percent. And just like median income, that figure compares unfavorably with all the other cities I’ve been looking at*:

As is apparent, poverty levels in every other city hover near 20 percent, or roughly 10 points lower than Provo’s level.

By way of comparison, Provo has a higher percentage of people living below poverty level than old, eastern industrial cities like Buffalo (29.6), Cincinnati (27.2), and Pittsburgh (21.9). Next door in Orem — where there is another large university whose students are no wealthier than Provo’s — just 13.5 percent of the population is living in poverty.

In fact, Provo’s poverty levels aren’t much lower than those in Detroit (34.5), and Detroit is notorious for its decimated manufacturing sector and for its struggles with poverty.

Some people will look at these figures and immediately want to explain them. Provo, for example, has a lot of students. Many of those students support themselves, marry earlier than other young people, and have kids quickly. Provo also has a history as a blue collar town meaning many of the city’s older residents never became very high wage earners.

There is a lot of truth to these explanations. But it’s important to remember that all of the cities included on the graph have students as well. Chattanooga and Ogden also both have state schools without huge research agendas and in the latter case many students are even members of the LDS Church (the same is true in Orem). In other words, I chose these cities because they each represent a different kind of college town.

But most importantly, these explanations are beside the point. Whatever the causes, if Provo’s residents are poorer than those in other cities Provo will have less economic vibrancy. In other words, explanations themselves won’t change the problem, which is that lower incomes and more poverty are one big reason Provo feels less successful than other cities.

With higher poverty rates than other cities, it makes sense that Provo would have similarly higher vacancy rates in downtown buildings.

It’s also worth mentioning that people in Provo should be embarrassed by these figures. For strategic reasons, I’ve typically chosen to make mostly economic arguments on this blog — so for example that more money means greater vibrancy. But it’s also simply wrong for nearly 1 in 3 people in our city to be certifiably poor. Provo is a young, educated, business friendly community; having such a high poverty rate is unacceptable. It’s morally outrageous. And, unlike Rust Belt cities, it’s almost never discussed.

In any case, it also effects everyone because wealth and resources are factors that make or break places like Downtown Provo. If the community wants to be as thriving as other cities, these rates will need to change.

*For the next few posts I’m going to be sticking with my original five cities simply because it takes time to compile and graph all of this information. Some readers have suggested several other great possible additions and I hope to discuss them in the future, but for now the cities I’ve included seem to have sufficient diversity to make the point.

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Filed under Development, Downtown, economics

Provo: The Poorest City in Its Class

In an effort to better understand why Provo differs from other cities of comparable size and composition, I recently combed through some census data. As it turns out, the government provides a handy QuickFacts page for every city in the U.S.

My goal in looking at this data was to understand why Provo doesn’t have as thriving a downtown, for example, as other cities like Boulder, Colorado. Boulder and a handful of other cities often come up in conversations about how to improve Provo, and there seems to be a sense that if Provo could just feel more like Boulder it would be similarly successful.

I compared Provo to four other cities: Boulder; Ann Arbor, Michigan; Chattanooga, Tennessee; Ogden, Utah. All of these cities have colleges, comparable population sizes, and generally anchor medium-sized metros orbiting larger cities. Moreover, I included Ogden due to its proximity to Provo and its relationship to Salt Lake City, and Chattanooga because it’s one of the few cities of its size that consistently pops up in urban-oriented news.

How does Provo stack up against other cities? The points on this map indicate Provo, Boulder, Chattanooga, Ann Arbor, and Ogden, respectively.

What I found wasn’t encouraging. First, with 115,321 people, Provo is the second largest of the five cities and closest in size to Ann Arbor.

So far so good.

But when the median incomes for these cities are compared, Provo gets into trouble:

The graph above — where blue represents city income levels and red represents state income — reveals that Provo has the second lowest median income of all five cities. It just barely beat Chattanooga, and is even lower than Ogden. Here’s the data from both of the graphs, in case you want to see exact figures (click to enlarge):

The problem here isn’t just low income. As the second graph shows, the median income in Provo is also lowest of all five cities relative to its state. In other words the disparity between incomes in Provo and the surrounding community is larger than in any of these five cities.

Or, put another way, Provo is the poorest of all five cities. Only Chattanoogans may make slightly less, but that’s more characteristic of their state and, presumably, the lower state income levels indicate a lower cost of living.

It’s also worth pointing out just how much richer Boulder in particular is than Provo. The median income in Boulder is $13,887 higher than in Provo, and it’s much closer to the state median income.

Given these figures, it’s no wonder Provo struggles. People in Provo have thousands of dollars less to spend, meaning there simply isn’t as much wealth to support a vibrant retail sector, the arts, or entertainment, for example. Lower income also means less tax revenue, among other things, which translates into less money for the government to spend on various projects.

Frankly, it’s a wonder Provo has managed to compete at all given its comparably limited resources. I also have to admit I was surprised by these results; I knew that the median income in Provo would be lower than it is in Boulder or Ann Arbor, but I didn’t expect such a significant disparity, nor did I expect Ogden to be better off.

I’m not an economist — and I don’t want to oversimplify this data — but Provo’s relatively low median income seems like one of the biggest obstacles to downtown revitalization, neighborhood gentrification, and generally improving quality of life. In the end, none of those things are going to happen if people in Provo don’t have the money to support them.

And yet far as I can remember I’ve also never heard any discussion regarding this issue. Ever. Why is that? Though it may be a bit wonkish, this is extremely important because it directly impacts Provo’s ability to improve. Ultimately, wanting the city to improve and sprucing it up here and there is nice, but if Provo remains the poorest city in its class it’ll never be the most vibrant, lively, or successful.

Check back in the coming days for follow-up posts on how Provo’s home values, poverty levels, business environment, etc. compare to these five cities.

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