Fuel prices reinforce need for urban development

Higher gas prices are causing Americans to alter their driving habits and to either use or consider using transit if the option is available, according to a consumer survey released Oct. 3 by the Urban Land Institute. The survey results reinforce the need to build and rebuild urban regions in ways that offer alternatives to car-dependent development, according to ULI representatives.

The primary objective was to measure consumer attitudes toward transportation issues, including: transportation behavior – modes people use for both commute and noncommute trips; why consumers choose or reject alternatives to driving; the extent to which people would use or consider using an alternate mode of transportation; and the likelihood of using commuter rail transit or bus service.

Respondents of all ages, in all regions and all locations (urban, suburban and rural) listed gas prices as one of the top three issues of concern, along with education and crime. Interestingly, traffic congestion consistently ranked lowest among the concerns, with about two-thirds indicating that their commute had stayed the same over the past two years.

The majority of the respondents said gas prices had caused them to make some changes in both commuting and noncommuting travel. While nearly 90 percent said they had driven alone to work during the previous week, 40 percent said they had used alternative methods of commuting during the previous year, with the favored alternatives being car pooling and using transit or bus systems. Of those who commuted by alternative methods, nearly 25 percent did so to save money. In terms of noncommute trips such as errands, 81 percent said they have started combining more trips and 45 percent have eliminated some noncommuting trips.

Of those who drove alone to work, 38 percent said solo driving was more convenient, and 37 percent said they had no alternative. Gas prices caused 35 percent of all respondents to buy a more fuel-efficient car. Residents of the West, Midwest and South respectively were more likely to switch to fuel-efficient cars than those in the East, likely reflecting a higher dependency on autos in all regions compared to the East, where transit use is more prevalent. Moreover, half of all the survey participants said they would switch to commuter rail or bus service if it were closer to their homes or workplaces.

“The findings of this survey clearly show that consumers are rethinking how much money and time they are spending getting from one place to another,” said ULI Senior Resident Fellow Edward McMahon in a news release. “It underscores the need for more efficient development that gives people more choices in where they live, work and play.”

He noted that the survey findings suggest that higher gas prices may be the “tipping point” that causes a general shift in consumer attitudes regarding development that is more concentrated and which mixes uses, versus sprawling, isolated-use development that is heavily reliant on autos for mobility.

Although the survey was conducted soon after hurricanes Katrina and Rita – when gas prices had jumped higher than their current level – the cumulative effect of rising prices “may ultimately help make the case for more dense development that saves both land and gas,” McMahon said.

This possibility also was raised in the 2006 Emerging Trends in Real Estate report, an investor survey recently released by ULI and PricewaterhouseCoopers. Emerging Trends, which contains predictions about the real estate industry in years ahead, states: “An extended period of higher energy prices could curtail fringe suburban growth and dampen demand for big houses with their outsized heating and cooling bills … Greenfield developers beware.”

Emerging Trends also points to the continued downtown migration by young childless professionals and, to a lesser extent, empty nesters as a product of an overall attempt to conserve more gas and save travel time.

“High gas pump prices and suburban congestion are stimulating more interest in urban alternatives – 24-hour downtowns and subcities,” Emerging Trends states. “Transit-oriented development near subway or light rail lines almost can’t miss.”

“The central emphasis of much urban transportation planning is getting people out of the car,” said ULI Senior Resident Fellow Robert Dunphy. The survey results show that growing traffic congestion and sky-high gas prices are causing people to seriously consider ways to reduce driving through fewer and more efficient trips, car pooling, walking, transit, and moving to places where they do not have to drive as much, he noted.

“These changing attitudes will reinforce the strength of the market that we have seen for development in places with a diversity of travel options. The fact that people have actually tried alternatives to the car shows that walking and transit must be designed as part of communities, rather than added later,” Dunphy said.

The support expressed by survey respondents for both rail and transit shows that development in communities offering nearby transit and convenient walking destinations “gives those transportation modes an advantage, rather than trying to get them to work in suburbs that are car-dependent,” he added.

The relatively low concern expressed for traffic congestion shows that residents of urban regions are finding their own solutions to traffic woes, including the relatively drastic step of moving closer to where they work. For instance, 21 percent of the survey respondents indicated they had decided to look for a home closer to their jobs. Not surprisingly, the survey respondents ages 18–34, who were least likely to have school-aged children, expressed the strongest desire to uproot and live closer to work. Similarly, urban residents (many of whom are presumably young professionals) were the most willing to move; they were also the most likely to start walking and bicycling more to conserve gas.

Conversely, residents in suburban and rural areas were more likely than those in urban areas to purchase a more fuel-efficient car. They were far less likely than urban residents to increase bicycling and walking, or to look for a home closer to work, suggesting that their current living environment is not conducive to transportation alternatives.

The Urban Land Institute is a nonprofit education and research institute with the mission to provide responsible leadership in the use of land in order to enhance the total environment.