Realty Times December 20, 1999

Sprawl Arises From Population Demands, Not Builders
by Lew Sichelman

Presidential hopeful Al Gore, a man who claims to have been a home builder before entering public life, has managed to raise the hackles of the nation's home builders by saying too much land is being gobbled up by suburban development.

National Association of Home Builders President Charlie Ruma doesn't dispute the fact that during the five-year period between 1992 and 1997, some 16 million acres of raw land was converted to urban uses. But the Columbus, Ohio builder says the Clinton Administration can't have it both ways.

On the one hand, the White House "is the first" to take credit for perhaps the longest and most prosperous economic expansion in the country's history as well as an unprecedented increase in home ownership to record levels, Ruma points out. But on the other hand, the Administration "turns around and blasts development" for taking too much open space.

The Democratic front-runner is a staunch advocate of so-called "smart growth," the catch-all planning strategy that, among other things, encourages comprehensive land use planning in local communities and the use of such innovative techniques as cluster developments and higher density zoning.

But so is the NAHB, which is working with the nation's mayors and the Administration to encourage infill development and to stimulate new housing in the inner cities and older suburbs. Indeed, the 200,000-member trade association has pledged to build 100,000 houses a year in urban areas over the next decade.

Furthermore, while there are probably more avowed environmentalists than there are builders, builders consider themselves environmentalists, too. And considering their long reach into the economy, they may just be able to generate more votes.

Building a single house creates 2.5 jobs for a year. Not just carpenters and plumbers, but furniture salesmen and moving truck drivers, too. In total, new residential construction accounts for 5 cents of every dollar spent in the U.S. economy, and that doesn't include the impact the buyers of all these new homes have on their local economies for years to come.

So the vice president may want to tread a little more lightly, or at least stop speaking out of both sides of his kisser. That said, here's the NAHB's take on the nearly 16 million acres of forest, cropland and open space that was converted between 1992 and 1997:

  • Using a conservative estimate of just two single-family houses per acre and six multi-family units an acre, the 5.6 million houses and 1.2 million apartments built during the five-year period accounted for just 3 million of the 16 million acres. The remaining 13 million acres were used for schools, shopping centers, roads, employment centers and other uses.

  • Those 3 million acres represents only about 1/10th of 1 percent of the nation's total land mass, which is 2.4 billion acres. Even the 16 million converted acres is relatively small, accounting for less than 7/10ths of the total.

  • The suburbs are growing because that's where the majority of people want to live. For most first-time owners, the outlying suburbs, where land is cheapest, is about the only place they can afford to buy. And for many repeat buyers, the further out the better.

  • Furthermore, that's where the work is. Labor Department stats show that three out of every four new jobs created in urban markets are located outside the central city.

  • During the next decade, demographic demand calls for the construction of between 1.3 and 1.5 million new houses a year. Home builders don't create the demand, they just satisfy it.

    Put another way, they don't make the babies, they just house them. And it might do well for all political candidates, not just former builder Al Gore, to recognize that fact.



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