A Recent USC Lusk Perspectives Online Discussion
On July 14, 2020, the weekly Lusk Perspectives hosted an online discussion that, likely unbeknownst to the presenter, provided indirect but sound support for my newfound professional conviction. This conviction is that there is growing consumer demand for residential homes at the exurban fringe built according to real estate development principles that better preserve the land area’s surrounding ecosystems and natural environment. Such conviction was the topic of my LL.M. thesis, completed in 2018.
The guest presenter was Bird Anderson, the Executive Vice President, Homebuilder Banking, Well Fargo Commercial Real Estate. The discussion’s primary focus was on the United States homebuilding market since the COVID-19 outbreak, specifically looking at what’s changed and what’s here to stay. A key market observation of the presenter is one that is now widely accepted: that business shutdowns are permanently altering the ability for buyers to consider residential markets further out from urban office hubs. This is due to the work from home phenomenon, which is becoming commonly known as merely WFH. Workers across the income and job spectrum now believe that significant “work from home” structures are here to stay. This outlook for the future significantly alters the opportunity cost equation that home buyers will now consider due to WFH’s reduction or even elimination of long commutes from further out exurbs.
Home Buyers Now Want Wide-Open Spaces
The combination of the WFH phenomenon combined with the two other COVID-19 major everyday living disruptions (sudden consumer goods shortages and the need for social distancing) has sharply increased the desire of home buyers to live in wide-open spaces. Almost by definition, wide-open spaces means those exurban areas that preserve their wildland character, which is best done by preserving the large-scale ecosystem in which the exurban area exists. Mere cosmetically landscaped “open spaces” or “green spaces” commonly found in master-planned suburban communities will no longer suffice.
Opportunity for More Ecologically-Based Land Use Laws
Looking ahead, the increased demand for housing at the exurban fringe provides an unintended opportunity for both private sector developers and local public agencies and officials to reboot their local land use laws to capture the benefits that can come with this increased consumer demand. To be successful, the reboot of local land use laws must integrate the consideration of ecosystem-level conservation into the entire land use process, from comprehensive planning by the local decision-makers to the specific subdivision design plans pursued by developers.
Unknown Dangers of Housing Density in COVID19 Transmissions May Provide a Catalyst for Exurban Migration
There is also a proverbial large unknown elephant in the room. The migration of WFH workers out of urban areas, even suburban areas, to the exurbs — will rapidly accelerate if future research reveals that higher housing density had a correlation to the spread of the highly contagious infectious disease that the current coronavirus is.
New York Governor Andrew Cuomo tweeted on March 22, 2020 that “[t]here is a density level in NYC that is destructive.” Researchers at Children’s Hospital of Philadelphia and the University of Pennsylvania developed a model, known as COVID-Lab: Mapping COVID-19 in Your Community, which supports the notion that population density is one of the two most important factors driving the spread of the coronavirus. Currently, there is insufficient scientific studies to definitively support the proposition that housing density is a significant factor in the spread of the coronavirus. However, given the scientific uncertainty, it is no surprise that recent articles from the largest newspapers in the United States’ two largest cities – New York and Los Angeles – each raised such a prospect.
High-Density Developments May Fall Victim to Concerns about Future Pandemics
On April 26, 2020, the L.A. Times ran an article “Building dense cities was California’s cure for the housing crisis. Then came coronavirus.” Two weeks later, the New York Times ran a similarly themed article “Coronavirus Crisis Threatens Push for Denser Housing.” Across the United States a large portion of the population is already fearful of being vulnerable to another pandemic occurring in the near future. If it turns out to be the case that higher housing density led to a disproportionate greater number of coronavirus infections, then the decades-long push for higher density housing in urban — and more recently suburban – areas, faces an unknown and potentially dark future. At the same time, the exurbs will face the flip-side of that problem in the form of an imposing opportunity for positive change.