Eco-growth, sustainable development growth

Increasingly, local governments across America are working to create eco-friendly public amenities—bike paths and light-rail networks—and zoning for transit-friendly smart growth developments (read sustainable development) that combine compact housing with shops, schools, and services. And just like extra insulation in the attic, these kinds of investments are already paying dividends—both to whole communities and to the individual homeowners who live in and around them.

Smart growth finds inroads around U.S.

It’s happening in places like Denver, Pasadena, Calif., and Arlington County, Va. But the vanguard is Portland, Ore. That city’s extensive network of streetcars and so-called “complete streets”—which offer trees, generous crosswalks, and dedicated cycling lanes—mean that its residents don’t need to climb behind the wheel as often as most Americans. In fact, researchers with the region’s government found that the locals drive four fewer miles per day than their counterparts in other U.S. cities.

That might not sound like much, until you scale it up across the whole metro population. It turns out that each year, if you include the value of productive time lost to commuting, Portlanders hang onto about $2.6 billion that they would otherwise spend on their vehicles.

Spend transportation costs on housing instead

So where does the money saved on traveling fewer miles get spent? No one has kept track, but there are clues. A national study by the Center for Housing Policy shows that there’s an inverse relationship between household spending on transportation and housing: Households that spend more on transportation spend less on housing and vice versa.
“We have less congestion, shorter commute times, and more housing and transportation choices than is typical of American cities,” says Metro Portland Councilor Robert Liberty. “Our neighborhoods are maintaining their value—and not just property value, but community vitality as well.”
Other research supports his claim. Valuing New Urbanism—a pivotal 1999 study by San Diego University’s Charles Tu and Mark Eppli of George Washington University—found that consumers were willing to pay an 11% premium for homes in compact and walkable smart-growth style neighborhoods. By 2007 Eppli said that premium had increased to 16%, and that it was still holding despite the current market correction.