How To Buy A Home That Grows in Value

Continuing the transit theme from the past few days, here’s one way to ensure your house increases in value: make sure it’s located near a transit station.

That’s according to a study commissioned by the American Public Transportation Association. The study argues that people are willing to pay more for housing located near public transit:

Moving beyond the traditional arguments that good schools and neighborhood amenities impact hous- ing prices, emerging research has indicated that urban form and transportation options have played a key role in the ability of residential properties to maintain their value since the onset of the recession.

Studies have shown that consumers are willing to pay more for housing located in areas that exemplify new urbanist principles or are “traditional neighborhood developments.” These neighborhoods are walkable, higher density, and have a mix of uses as well as access to jobs and amenities such as transit.

I’m an example of this.

People, including me, are willing to pay more for housing located near transit.

As I mentioned earlier this week, I just moved to Salt Lake to be closer to my job. I chose the location of my new home based on proximity to my office, but equally important was proximity to Frontrunner. We pay considerably more per square foot for housing in Salt Lake than we did in Provo and we’re willing to do that because it’s located three blocks from the Frontrunner station and one block from a TRAX stop.

The study goes on to mention that housing near transit was more resilient during the recession. (I haven’t finished reading the study yet but if I didn’t blog it now, I’d never get around to it. I’ll finish it Friday after work.)

On the other end of the spectrum, Grist reported earlier this year that there are 40 million McMansions that no one wants because they’re not located in walkable, transit-oriented neighborhoods:

Only 43 percent of Americans prefer big suburban homes, says Chris Nelson, head of the Metropolitan Research Center at the University of Utah. That mean demand for “large-lot” homes is currently 40 million short of the available stock — and not only that, but the U.S. is short 10 million attached homes and 30 million small homes, which are what people really want.

Taken together, then, it’s pretty clear what kinds of housing will retain and increase in value: transit oriented ones. That should be helpful for people with a home purchase somewhere in their future; they just need to check potential sites’ proximity to public transit.

Homes without access to public transit don’t retain value well. In some cases no one even wants them.

For those already in a home, being along the Wasatch Front, and particularly in Provo, happens to be a good place because we have an expanding transit system and a growing population. However, it’s important to keep in mind that supporting transit — as well as transit-promoting development like density, mixed uses, low or no parking, etc. — is also a reliable way to improve home values.

An Update, Or, This Is Now The View Out My Window

The picture above is a view out my current window. So, I have officially moved to Salt Lake City. (If you’re interested, read this earlier post where I explain my new job, which is what precipitated the move.)

It is with difficulty that I write this because, as I’ve written before, I love Provo and consider it my semi-adopted hometown (I was born in Provo but grew up in LA). However, the commute was killing me and I can’t very well write about the evils of driving a lot without practicing what I preach. One of Laura’s and my goals is also to reduce our overall driving and moving allowed us to do that; I now commute on foot to work and only drive when going on assignments and Laura commutes via Frontrunner, bus and bike.

As I wrote earlier, Laura and I hope to come back to Provo to live. In the meantime we’ve been in Provo at least once a week because most of our friends and family are still there. In other words, you’re only slightly less likely to see us on the streets than you were before.

So, you might ask, what does all of this mean for this blog?

For starters, I’m planning to do some sort of relaunch in the near future in which this blog becomes a more pan-Wasatch Front urbanism site. I’ll still write about Provo because I like it, know more about it that other places, and because I think Provo is where most of the exiting developments in Utah are happening.

But I’ll also write about other cities along the Wasatch Front. In reality, I already do that so not much will change, except that maybe I won’t tie everything thought back into Provo’s Center Street, the Joaquin neighborhood, or whatever else. So in terms of content, much of the blog will stay the same.

I’m not totally sure when the relaunch will happen; I have a bunch of posts in the queue right now that I want to publish before doing it and I haven’t settled on exactly how the re-imagined blog will work. But it’s coming and I thought it was only fair to mention it.

Attached Homes in Salt Lake City

While driving around Salt Lake City recently I saw these two homes:

Two old, attached homes in Salt Lake City

As is apparent, these homes are attached to one another. They’re also apparently historic and have a “house” feel to them. Or, in other words, they don’t look like condos, town homes or apartments.

This type of arrangement is common in some parts of the world but rare in Utah. However, it shows that it’s possible to cut out the wasted space between houses without turning your street into Brooklyn (much of which is very nice, though). And yet, as I understand Provo’s building laws, this would actually be illegal to do today.

This also has some other obvious benefits: energy savings, less yard maintenance, etc. And while these houses are clearly not in a high density neighborhood, this design could be repeated over and over to create many attached homes. Or not; like everything, it’s just one more option for increasing density without sacrificing quality and there are almost infinite options for the final configuration.

Streets Are Like Sentences, Or, Making Walking Less Annoying

Walkability is about more than safe, interesting streets lined with potential destinations — though those things are extremely important. It’s also about eliminating the little pressure points that annoy people and make them wish they weren’t walking in the first place. In other words, much like sentences, streets need to be “edited” not just for big things but for the little problems as well.

I’ll try to touch on various little pedestrian problems in the future, but for now note the cross walk buttons in the picture below. For some reason, one of them has been placed in an illogical and difficult-to-find spot.

A crosswalk in Salt Lake City, looking west.

In the picture above, the green arrow points to the East-West crosswalk.

But bafflingly, the button to trigger the signal for that crosswalk is located on the poll near the North-South crosswalk. It’s marked by the red arrow and is a good 20 feet from the crosswalk it serves.

The button may have been installed on that distant post to save money — though Provo has installed separate posts in some places that’s clearly more expensive — but that still doesn’t explain why it faces North, away from the correct crosswalk.

The same intersection, looking north.

The picture above further illustrates the problem: one crosswalk button, marked by the red arrow, is easy to find. The other button, however, is on the other side of the pole (north) and almost as far from the crosswalk it serves — marked by a green arrow — as it can be. Just putting it on the side of the pole facing the photo (south) would have been a huge improvement.

These sorts of things are like typos; people don’t stop moving when they hit them but they do momentarily slow down. And the problem is particularly bad in Utah, where large streets create huge street corners; when I walked up to this intersection it took me at least three times as long to find the button as it would have at a better-designed spot. It was a brief pressure point that didn’t need to exist.

People won’t give up walking as a result of little errors like this. But they will be annoyed, if only subtly. And that’s unfortunate because the emotional memory they’ll have from walking will be negative.

The point is that a good street should be like most forms of good writing: it should blend into the background and let the user flow from one point to the next. Exceptional beauty can stand out, but both writing and city design fail when the mechanics become clunky and slow or when they call too much attention to themselves.

Finally, note how in these pictures there aren’t actually many people on the street; that’s the best evidence of all that the design of this street isn’t working. With better “editing,” streets like these should become more lively and pleasurable to use.

Parking Structures Don’t Have to be Hideous

Just a quick post today about parking. I’m sure we’ve all see parking structures that looked like huge concrete boxes. They’re boring at best and spatial black holes at worst.

But over the weekend I was up at the University of Utah Hospital and saw the structure in the picture below. As a parking structure, it’s still an under performing piece of real estate.

But it’s also not bad looking. It just goes to show that as is the case with other kinds of buildings, parking structures can be well-designed or not.

Provo Needs More Housing Without Parking

In my recent post on converting malls to housing I mentioned the need for more nice-but-affordable housing in Provo. I used loft style housing as my example because that’s popular right now, but really Provo just needs better housing of any kind that is appealing and not geared to either established families or students.

And one really great way to make housing affordable is to cut parking.

As is the case in many cities, it’s standard in Provo to include parking in new development. I recently attended a meeeting about a proposed development in the Joaquin Neighborhood — one of the more walkable places in Utah — that proposed two parking spaces per unit. It’s insanity because parking induces demand for parking.

But even most historic housing in Provo has parking; though there are really old homes here and there that lack garages, they’re the exceptions rather than the rules. The problem, then, is that even people who want to ditch their cars are forced to pay higher housing costs that include parking.

But up in Salt Lake City there are some buildings that don’t include parking. Take this listing, for example:

The link includes additional pictures of this apartment, but really its quite an impressive place. And it has no parking. The result is that the $182,000 price tag buys more home for someone willing to take advantage of the walkable surroundings.

When I asked what people with cars do, I was told that “there’s plenty of parking on the street or you can buy a pass for a city lot.”

Here’s another parking-free listing for a very cheap but very cool place not far from the Gateway and Pioneer Park:

Note the extremely low price of this condo. There are some financing issues that contribute to that price, but comparably sized apartments with parking in downtown Salt Lake City go for $40,000-$100,000 more.

The point is that a city with aspirations of greatness and walkability needs housing like this. It doesn’t destroy the city, create nightmarish congestion, or generally ruin the world. Indeed it makes the city more diverse and affordable for the professionals and small families who choose these places. In many cases, these places also end up being some of the coolest, most valuable spots in the city.

And as I’ve mentioned before, there’s nothing like this in Provo.

Provo isn’t ready to eliminate all parking and that isn’t a realistic possibility anyway. But it is ready for some housing for people who choose not to drive, or who would rather not have their parking costs rolled into their housing costs. That type of housing is a reality in many other cities and given Provo’s age it’s surprising there isn’t more of it already. But until that changes, Provo will continue to be at a disadvantage in the competition for talent and growth.

Build Neighborhoods Out of Malls

Malls in Utah County and everywhere else are struggling. If this is news to you trying reading this article that has some background and history, or click here, here, or here for recent posts on the subject.

The now-vacant Nordstrom space in Orem.

Or just go to a mall. Trolley Square is in serious financial trouble, two thirds of the anchor spaces in the University Mall are empty, and rumors indicate that the Towne Center Mall is about to lose the Gap.

Like many cities, Provo doesn’t seem to have grasped the enormity of this problem; the question isn’t “how can we save the mall?” it’s “what can we do in the not-too-distant future when we are required to move to Plan B?”

I believe the best answer — at least along the rapidly growing Wasatch Front — is to turn malls into neighborhoods.

This idea likely would involve two components: 1) repurposing existing mall infrastructure for housing, etc., and 2) building new (mostly residential) structures in underused mall parking lots.

Repurposing existing mall structures is the most exciting part of this concept. Basically, former retail spaces could be carved up into condos or apartments. Anything would be possible, though a natural outcome would be semi-industrial feeling units — cement floors, exposed ducts, concrete pillars, etc. This type of housing doesn’t appeal to everyone, but it basically doesn’t exist in cities like Provo.

This is a loft in Salt Lake City that was converted from an old factory. It’s small, and therefore relatively affordable, but costs a lot per square foot. Provo has nothing like this but could easily use it’s mall spaces to cater to a similar niche.

In other words, converted mall spaces are the warehouse lofts of tomorrow. Even up in Salt Lake City converted warehouses are popular and command high prices per square foot of real estate. For example, listings here, here, here, and here are all unlike anything in Provo right now. This listing is a new building that’s even trying to copy the aesthetic of a converted warehouse.

Aesthetics aside, this type of development provides the opportunity to create big multi-unit buildings at a fraction of the cost. And because the units can vary in size, they can also remain affordable. Right now, Provo basically loses anyone looking for housing in the nice-but-affordable multi-unit market.

The second part of this concept would involve building more housing — as well as other things like schools, libraries, parks, etc. — where mall parking currently exists.

The advantages of this plan are that the land is open, already surrounded by infrastructure, and privately owned. It would take a horrible space and make it desirable and profitable at a fraction of the cost that similar projects require. And if the owners were on board, it would combine the best aspects of both infill and new development.

And there’s a massive amount of space:

Provo’s Towne Center Mall, surrounded by staggering parking lots.

At the Provo Towne Center Mall much of the existing parking already goes unused so there’s no reason this part of the plan couldn’t beginning immediately. It’d almost certainly help the mall by adding customers. The development could be single family homes, apartments, condos, etc. The point is that there’s room for hundreds, perhaps thousands, of residences in this space.

There are an infinite number of possible configurations, but take a look at the pictures of the Towne Center’s north side:

Sears and a parking lot in Provo.

Now imagine if front doors were cut out of the Sears wall for condos, essentially turning it into row housing. On the right side of the picture, where there are cars, there could be more row homes, cottages, or tall buildings. I’d favor something that created a pleasant street wall, but regardless it only takes a little bit of imagination to see this as an incredibly vibrant neighborhood. It’d be a narrow little street filled with families. And it’d make a developer rich.

Here’s another picture:

The same spot from a different angle.

In the picture above, imagine homes lining the left side of the street. And again, the great thing about this idea is that much of the infrastructure already exists. It’d be like getting a City Creek (with a bit of Daybreak) in Provo that was far cooler and vastly cheaper. It could be done in a way that incorporated some of the mall’s current function as a retail center, or the entire site could be reimagined. There’d be ample space — perhaps the first floor of the Sears that faces east — for a grocery store like Harmon’s.

This idea really coalesced for me after I wrote a series on building houses in the street. People liked the idea, but thought it’d be tough to overcome the political and physical obstacles. Malls spaces don’t fix existing streets, but they are open, underperforming and not ruled by existing infrastructure or NIMBY problems.

In fact, if cities can make something like this work malls may become major assets, much like old factories and warehouses turned out to be beneficial to post-industrial cities.

Variations of this idea already exist. The Atlantic Cities recently mentioned one, and City Creek and The Gateway also probably both fit the bill.

But all of those projects are firmly grounded in a mall mentality and frankly I wouldn’t reside in any of them. Provo and cities like it, on the other hand, have an incredible opportunity to treat their malls as exercises in adaptive reuse. And in the end if we do nothing that’s exactly what we’ll have in place of our malls: nothing.

The Salt Lake Temple Hasn’t Revitalized Salt Lake City

A few days ago I read this post from Provo Buzz expressing excitement about the city’s development. I share that excitement and I love reading blogs like Provo Buzz that write intelligently about the city. But after reading I thought it might be time to revisit the economic impacts of the LDS Church’s Provo Tabernacle Temple — aka the “City Center Temple” — which may not be as significant as most people expect.

First, there isn’t a major precedent for the temple to revitalize downtown. Most LDS temples are located in suburban areas where commercial revitalization isn’t an issue. The fact that these temples have failed to spur adjacent commercial development should itself be a warning sign. And the handful of urban temples went into places that were already comparatively well-developed, even thriving.

I’ve expressed these concerns before (also, here), but the one big exception is the Salt Lake temple. It’s urban, historic, and a major destination in the city. The comparison to Provo makes sense, which is probably why people keep making it.

But the funny thing is that Salt Lake, particularly around Temple Square, isn’t all that thriving.

Consider first the high percentage of parking in downtown Salt Lake City. As mentioned in this post, 20 percent of downtown Salt Lake is paved for parking lots. That only happens when demand for real estate is low enough to make structures economically unattractive. In other words, there is surprisingly little demand for real estate in downtown Salt Lake City.

This problem is particularly apparent in the area immediately surrounding Temple Square, where massive parking lots abound.

This picture is pretty typical of downtown Salt Lake City, where tall buildings are generally surrounded by huge parking lots. Here, the lot is on the right and is larger than the picture really conveys.

It’s ugly, of course, but most importantly shows that the land immediately surrounding the temple is barely performing, economically speaking. That’s a situation at odds with our image of a lively temple with lots of temple-goers-cum-consumers in the area. But either way, if the temple was generating significant investment, people would be snatching up this land for development.

Yet another big, flat, underperforming piece of land in downtown Salt Lake City.

So based on Salt Lake City, the biggest change we should expect to see in downtown Provo when the temple is completed is more parking lots.

Next, consider who is investing in Salt Lake City: the LDS Church. I applaud the church’s efforts to revitalize downtown (even as I criticize its methods) but again, this suggests that there’s a conspicuous lack of demand for space downtown.*

If the temple in Salt Lake was spurring adjacent development there should already have been a lively retail sector before City Creek existed. Instead, the temple’s owners — the church — had to step in and do it themselves.

If existing buildings, including the temple, were really generating investment the church wouldn’t have needed to build its own mall; investors would have lined up to do it for them. If demand had been high enough — and it should have been — the church could even have dictated the type of environment it wanted the way it did with City Creek. None of that happened so the church had to foot the massive bill on its own.

The type of development that surrounds Temple Square is also curious. There are mediocre hotels, a ratty looking JB’s restaurant, etc. Other than Church-owned property — which is in great condition — it’s surprisingly run down. Within a block or two there are major vacancies and blight. It’s pretty dire and in some cases worse than the situation in Provo, though the gleaming towers in the mix make it seem more thriving than anywhere in Utah County.

This JB’s restaurant is directly across from Temple Square. These kinds of building suggests to me that the temple is not creating significant demand for space or investment opportunities.

There’s no doubt that Salt Lake City is on the rise and downtown in particular is improving. But it’s being buoyed up by the same economic and demographic factors that are benefiting Provo, not by the presence of an LDS temple. Indeed the temple has existed for generations, but that didn’t stop Salt Lake from experiencing the disinvestment and decline that the car-centric mid twentieth century brought to many cities. And that was still going on very recently; when I moved to Utah a decade ago downtown Salt Lake was even less desirable. During those last 10 years the temple is one of the few things that hasn’t changed.

I like the Salt Lake Temple and I like the area surrounding it. But in terms of economics and revitalization it’s really a case study in the surprisingly minimal economic benefits a temple brings to surrounding consumer businesses. Sure any infusion of people helps and when the temple in downtown Provo opens nearby restaurants are likely to get a few more walk-ins.  But if Salt Lake City offers any clues about the future of Provo, we all have reason to worry.

*Some people will argue that the area surrounding Temple Square has been developed (or paved) by the LDS Church because the church wants to protect the environment around its headquarters. Or in other words, that economics aren’t a factor. That may be true to some extent, but many of the parking lots are privately owned, conditions generally get worse moving away from Temple Square, and the retail centers that aren’t insulated from the market — namely Trolley Square and now the Gateway — are struggling.

More on Salt Lake City Parking

Yesterday, an astute reader alerted me in a comment on this post about parking in Salt Lake City to a recent article in the Atlantic Cities about the same topic. I’m not sure how I missed the article, but it’s quite illuminative:

Fearing that their hometown is becoming a lake of asphalt, Salt Lake City councilors have outlawed the practice of knocking down buildings to create surface parking lots. Right now, Salt Lake has about 55 acres of blacktop carpeting the downtown area, a hefty 20 percent of its surface area. The new ordinance, which affects a central commercial district, is meant to prevent more gray slabs of blah from masquerading as urban blocks, […]

The article is based on this Salt Lake Tribune piece, in which councilman Stan Penfold expresses fears that parking is going to suck the life out of downtown. I’d argue that he’s too late; Salt Lake is a fun place but feels oddly dead and small as a result of the large swaths of pavement.

One of many big parking lots in downtown Salt Lake City.

I’d also say the ordinance doesn’t go far enough; 32,000 spaces is plenty for a region the size of the Salt Lake Valley, and if those spots fill up it merely incentivizes more people to use alternate means, like public transit, to access downtown. For example, would fewer people come to the LDS Church’s general conference if there was less free parking? I doubt it because I think people believe more strongly in their faith than they do in their misplaced belief that parking should be abundant and easy to use. In any case, the point is that Salt Lake should be eliminating parking, not just outlawing the ugliest lots.

Another big parking lot in downtown Salt Lake City. I’ve seen this parking lot fuller than it appears here, but I’ve also seen it with a lot of empty spaces.

But while I’d ban all new parking if I were the king of Salt Lake, this new ordinance is still a positive move that offers lessons for other cities. For one, it points out that parking often has a negative impact on a downtown. As Penfold correctly points out, it can suck the life out of a place. Though obvious to some people, that’s a fairly radical shift in the car-centric West.

Yet another big sea-of-asphalt parking lot, just blocks from the lots in the first two pictures.

Salt Lake’s solution — requiring parking to be removed from the streets or tucked behind buildings — is also an improvement on the status quo. It’s an acknowledgment that a sea of asphalt should probably never abut a sidewalk or pedestrian zone. Now it just remains for Salt Lake, and Provo, to fix existing problem areas, of which there are many.

It’s also worth noting that Minneapolis, which struggles with a similar problem, has devised an even more novel plan to improve its downtown: taxing land at a higher rate than buildings:

The conventional property tax, which taxes land and buildings at the same rate, is essentially backwards when it comes to the behaviors it incentivizes. It penalizes property owners for building or making improvements to their structures, while rewarding speculators and absentee landlords who would rather allow their properties to decay than make expensive (and annually taxable) improvements. Taxing land and buildings at the same rate means that as long as you don’t put any buildings on your land, your tax bill is going to remain relatively cheap.

The new plan would tax land at it’s “development potential,” thus creating incentives for people to actually do something with it rather than wait for someone to come along and pay a “‘pie-in-the-sky’ price” for it.

One effect of these types of lots is that they make Salt Lake seem less like a city and more like a strip mall. They stretch spaces out, particularly for pedestrians, and make things seem farther away than they really are. The result is a space that feels huge but simultaneously lacks the “bigness” — conveyed through buildings, etc. — often associated with cities.

Unlike stores, offices, homes, and other destinations, parking lots also don’t generate much street life; people park and leave, without lingering. The result is comparative dead zones, which also makes Salt Lake seem overly spacious, quiet, and un-city-like. Also, note what looks like a five-story red brick building in the background. I think that’s actually a parking structure.

This is another parking structure masquerading as a large building. As parking structures go, this one isn’t so ugly. But it still occupies (what should be) valuable land that could otherwise house businesses or people. These buildings pose a slightly different problem for Salt Lake City, but they’re also astonishingly abundant.

Parking in downtown SLC vs. Provo

Between Thanksgiving activities, the Frontrunner free ride day, and a couple of job interviews, I’ve recently spent a considerable amount of time wandering around downtown Salt Lake City. And I’ve been astounded at how much parking there is. It seems like every time I look up I’m staring at a high rise parking structure.

Curious to know more, I eventually found the Salt Lake Tourist and Visitors Center website and learned that “there are over 32,000 parking spaces in downtown Salt Lake City.” That’s incredible.

By comparison, I’ve been told that Provo has between 3,000-4,000 parking spaces in downtown. (The mayor’s blog includes some parking information, but the only source I could find was this mapquest page for the convention center. That’s not very authoritative, but 3,000 spaces is a fairly common number I’ve heard mentioned around the city.)

A parking lot in downtown Provo.

It’s helpful to put these numbers in context. The 2011 population of Salt Lake City was (a surprisingly small) 189,899. That means that with more than 32,000 parking spaces there is essentially one spot for every six people in the city.

By contrast, Provo’s population was 115,321* in 2011. If downtown Provo has 4,000 spaces, that means there is roughly one spot for every 29 people.

Some shop owners may look at these figures and see a need to add more parking to downtown Provo. If there was more parking, the reasoning goes, there would be more people.

But I strongly disagree.

What I see in these figures is a massive amount of wasted space in Salt Lake that will hamstring that city’s long-term vitality. Consider, for example, that every parking space occupies land that could otherwise be housing, offices, or retail, all of which generate various forms of tax revenue. Higher density also increases the number of consumers in an area — as well as a city’s productivity — while parking inherently decreases density by using space that could have been occupied by people. In other words, much as a previous post argued, shop owners should want more buildings for people and few parking spaces.

And apparently, that’s what Provo has. This document from Wasatch Choice 2040 also explains that putting parking in structures — as is the case in downtown Salt Lake City — dramatically increases the cost of development. That means a smaller and more homogenous demographic ends up living in downtown. So again, less parking per person in Provo turns out to be an advantage.

Back in June, I argued that having empty parking spaces is like leaving the lights on in an empty room; it wastes space and costs everyone money. Salt Lake is a perfect example of this phenomenon. According to the census, the average household size in Utah is only 3.10 people. That means there is roughly one downtown space for every two households in Salt Lake City. What are the odds that 50 percent of the Salt Lake City’s households will suddenly and simultaneously drive into downtown? That simply will never happen and even taking into account tourism and the larger metro area, there is still too much parking.

The same is probably true in Provo, but on a vastly smaller scale. New housing projects are also going to be using existing parking, meaning Provo will continue to capitalize on this advantage.

Walking through these two cities its apparent that Provo still needs to harness its potential. But long term, I think less parking and more buildings (or potential for buildings) will be an advantage.

*Sometimes I think we forget that the difference in population between Salt Lake City and Provo is actually not as big as it seems.