Demographic Trends

Shaping Future
Housing and Land Use
Dowell Myers
University of
Southern California
The Big Questions
How does demographic change shape
housing preferences and construction?
Whats normal and
what can we expect next?
What does this imply for the suburbs?
How can we share this future knowledge
for stronger public agreement?
Difficulties of Grasping
the Future
The future outlook is extended from prior
experiencesometimes recent,
sometimes long-remembered
The past is usually always better
Similarity is preferred because it is
known
Agreement is difficult about the unknown
Principles About Future Outlook
Source: Figure 4.1 in Myers, Promoting the Community Future.
The Challenge of Gaining Agreement
in Local Plans
Community Individual
Future
Present
Source: Figure 4.1 in Myers, Promoting the Community Future.
Gaining Agreement about an Unknown
Future
What
basis of
proof
???
Planning is persuasive
storytelling about the future
Jim Throgmorton
Resisting Big Brother who denies
freedom, heaps tax burdens, and grows
an unsustainable fiscal deficit
Building a Sustainable City that is
required by peak oil and global warming
Housing our Demographic Future that is
required by life cycle changes and that
demands new land use patterns
Stories of the Future
Recovering from
the Bust
Shillers 120 Year View of House Prices
Closer View of Prices in 1970 to 2020
When?
What will the market dictate?
What will the new normal look like?
How will we agree?
Questions About the Recovery
Whats Up with
Demographics?
Traditional aging, fertility & migration
Expanded scope -->
People migrate between cities
People live together in houses
People drive cars/ride transit
People pay taxes
People vote
People have preferences
Economics are powerful at the margin
Demographics are the people
and the main effects
Spending and Taxes in California by
Age, 2000
$0
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90
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Age
Spending
Taxes
Political Lag of Demographic Change
Housing & Land Use Questions
How do the demographic factors all come
together in housing & land use?
Gaining the Long View on turning points:
whats normal and comes next?
How do demographics square with more
infill and compact development?
What does it mean to have an aging
dominated housing market?
Minority Dictatorship of New Construction
Everyone else lives
in existing housing
1% of households
(growing segments)
dictate type of new
construction
Dowell Myers, USC
Impact of Population
Age Waves
Total Population of the United States
in millions
U.S. Population by Age Each Decade
in millions
0.0
10.0
20.0
30.0
40.0
50.0
60.0
70.0
80.0
Under 15 15-24 25-34 35-44 45-54 55-64 65+
2030
2010
1990
1970
1950
Source: Dowell Myers, USC; Data from Census Bureau
-10.0
-5.0
0.0
5.0
10.0
15.0
20.0
Under 15 15-24 25-34 35-44 45-54 55-64 65+
1950s 1970s 1990s 2010s
U.S. Population Growth by Age Each Decade
in millions
Source: Dowell Myers, USC; Data from Census Bureau
Total Population of Maryland
Source: Dowell Myers, USC; Data from Maryland Department of Planning
Maryland Population Growth
by Age Each Decade in 1000s
Source: Dowell Myers, USC; Data from Maryland Department of Planning
-300
-200
-100
0
100
200
300
Under 15 15-24 25-34 35-44 45-54 55-64 65-74 75+
1970s 1990s 2010s 2030s
Total Population of Montgomery County
Source: Dowell Myers, USC; Data from Maryland Department of Planning
Montgomery County Population Growth
by Age Each Decade in 1000s
Source: Dowell Myers, USC; Data from Maryland Department of Planning
-40
-30
-20
-10
0
10
20
30
40
50
Under 15 15-24 25-34 35-44 45-54 55-64 65-74 75+
1970s 1990s 2010s 2030s
Soaring Ratio of Seniors to Working Age
Source: California Department of Finance,
Census Bureau, and Authors calculations, 2010.
U.S.
California
0
5
10
15
20
25
30
35
40
45
1970 1980 1990 2000 2010 2020 2030 2040
Seniors (65+) per 100 Working Age (2564)
Myers 2010
+70%
In California
2010-2030
Soaring Senior Ratio in Maryland
Source: Myers calculations; Maruland
Department of Planning,
+77%
In Maryland
+90%
In Montgomery
2010-2030
0
5
10
15
20
25
30
35
40
45
50
1970 1980 1990 2000 2010 2020 2030 2040
Maryland
Montgomery
Myers 2010
Seniors (65+) per 100 Working Age (25-64)
Immigrant Uplift
Percent of U.S. Population Newly Immigrated
in Preceding 10 Years
Homer
Hoyt
1940
Predicted
urban
decline
Foreign Born Share of State Population
by Decade of Arrival (newest on top)
National Average
0%
5%
10%
15%
20%
25%
30%
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West Midwest South Northeast
Sarah Mawhorter, USC
Annual Immigration Levels Off in Traditional
Major Gateways
-50
0
50
100
150
200
250
300
350
1980 1985 1990 1995 2000
2005 2010
FL
TX
Miami-Dade
U.S.
NY
CA
Los Angeles County
Percentage increase in
annual arrivals
compared to 1980
Source: Dowell Myers, USC; Data from Census Bureau
Foreign Born Population in LA
by Length of Residence
United States
Soaring Immigrant Homeownership
For Each Immigrant Wave Arriving Before 1970, 80, 90, 2000
All
Native-
born
All
Foreign-
born
1960s
Arrivals
1970s
Arrivals
1980s
Arrivals
1990s
Arrivals
Data Source: Dowell Myers & Cathy Liu, Urban Policy and Research, September 2005
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
70 80 90 00
Change in Homeownership
For Successive Waves of Immigrants Arriving
Before 1970, 1980, 1990, or 2000
CA
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
70 80 90 00
NY
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
70 80 90 00
TX
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
70 80 90 00
Data Source: Dowell Myers & Cathy Liu, Urban Policy and Research, September 2005
FL
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
70 80 90 00
0.8
IL
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
70 80 90 00
Turning Points
in Cities
and Housing
Minority Dictatorship of New Construction
Everyone else lives
in existing housing
1% of households
(growing segments)
dictate type of new
construction
Dowell Myers, USC
Episodes in the Urban Condition
1. Urban Decline & Abandonment (1950-80)
2. Gentrification, the Long Boom
& the Affordability Crisis (1970-2008)
3. Collapse of Multifamily Construction (1990-2005)
Urban Revival & the Multifamily Rebound
(2006~2020)
4. Baby Boomer Sell-Off
& Ripple Effects on Suburbs. (2015-2040)
Source: Dowell Myers and John Pitkin (2009) Annals, AAPSS
Total Demographic Growth
Native-Born Turning Age 25 Plus Immigrant Arrivals
Myers and Pitkin 09
1
2
3
4
3.
Multifamily Trend
and Outlook
for Sprawl
0
500
1,000
1,500
2,000
2,500
1960 1970 1980 1990 2000 2010
I
n

T
h
o
u
s
a
n
d
s
Source: Census C-40 series
Housing Construction Permits - U.S. (1960-2010)
5+ Units
SFR
Century of U.S. Multifamily Construction Shares
0
10
20
30
40
50
60
1960s 1970s 1980s 1990s 2000s
?
Share of Housing Construction in Multifamily
In California Each Decade
Source:
Dowell Myers, USC
Age Profile of Tenants in Recently Built Apartments
Source: Dowell Myers, USC; Data from Census Bureau
Baby Bust
Hits Young
Adult Age
Growth at Ages 25-34 as a Percent of US Population
Percent Multi-Unit Housing (5 or more)
of Building Permits, by MSA, 1980-2000
0
10
20
30
40
50
60
70
1980-1989 1990-1999 2000-2006 2007-2008
New York-Northern New
Jersey-Long Island
Boston-Cambridge-Quincy
Philadelphia-Camden-
Wilmington
United States
Northeast
Source: Dowell Myers, USC;
Data from Census Bureau
Percent Multi-Unit Housing (5 or more)
of Building Permits, by MSA, 1980-2000
0
10
20
30
40
50
60
70
1980-1989 1990-1999 2000-2006 2007-2008
Chicago-Naperville-Joliet
Minneapolis-St. Paul-
Bloomington
Youngstown-Warren-
Boardman
St. Louis
Detroit-Warren-Livonia
United States
Midwest
Source: Dowell Myers, USC;
Data from Census Bureau
Percent Multi-Unit Housing (5 or more)
of Building Permits, by MSA, 1980-2000
0
10
20
30
40
50
60
70
1980-1989 1990-1999 2000-2006 2007-2008
Miami-Fort Lauderdale-Pompano
Beach
Dallas-Fort Worth-Arlington
Tampa-St. Petersburg-
Clearwater
Washington-Arlington-Alexandria
Baltimore-Towson
Houston-Sugar Land-Baytown
Atlanta-Sandy Springs-Marietta
Jacksonville
Louisville-Jefferson County
Nashville-Davidson--
Murfreesboro--Franklin
United States
South
Source: Dowell Myers, USC; Data
from Census Bureau
Percent Multi-Unit Housing (5 or more)
of Building Permits, by MSA, 1980-2000
0
10
20
30
40
50
60
70
1980-1989 1990-1999 2000-2006 2007-2008
Los Angeles-Long Beach-Santa
Ana
San Jose-Sunnyvale-Santa
Clara
San Francisco-Oakland-Fremont
San Diego-Carlsbad-San Marcos
Denver-Aurora
Las Vegas-Paradise
Seattle-Tacoma-Bellevue
Portland-Vancouver-Beaverton
Phoenix-Mesa-Scottsdale
Riverside-San Bernardino-
Ontario
United States
West
Source: Dowell Myers, USC; Data
from Census Bureau
The Continued Dominance of
?
Conventional Beliefs of Housing Preferences
American housing consumers are said to favor a
housing product that satisfies five major criteria:
suburban fringe location
single-family detached unit style
location within a low-density neighborhood
ease of automobile use, including driving
and parking
and lowest cost given these criteria
Question:
Would you most prefer to live in
a single-family detached home,
an attached home such as a condo or
townhouse,
an apartment, or
another type of dwelling?
Asking California Housing Preferences, 2001
Source: Statewide Poll of the Public Policy Institute of California, Mark Baldasarre, Director
Question:
People say there are tradeoffs in choosing
a local community to live in, meaning that
you have to give up some things in order to
have other things that you want.
How do you feel about these tradeoffs
other things being equal? (rotate questions
14-17)
Trading Off California Housing Preferences, 2001
Source: Statewide Poll of the Public Policy Institute of California, Mark Baldasarre, Director
Would you choose to live in a small single-family
detached homeif it means you could live close to
work and have a short commute?
Would you choose to live in a dense neighborhood where
single-family homes are close together if it
means you could be near parks and greenbelt
areas?
Would you choose to live in multi-story, multi- family
housingsuch as a condo or apartmentif it
means you could walk to shops, schools, and mass
transit?
Would you choose to live in a single-family detached home
with a backyard in the suburbs if it means you
would live far from work and have a long commute?
Trading Off California Housing Preferences, 2001
84%
74%
47%
42%
32%
0% 20% 40% 60% 80% 100%
Prefer single family (SF) detached home
Small SF, but with short commute
Dense SF, but with parks&greenbelt
Suburb SF w/backyard but long commute
Condo/Apt--walk to shops and transit
California Housing Preferences, 2001
Not monolithic
Source: Statewide Poll of the Public Policy Institute of California, Mark Baldasarre, Director
Percent Calling Factor Very Important
if Buying a Home Today, U.S. 1999
The NAHB Trade-Off Question
Consider the following hypothetical choice:
Your income is high enough to purchase a
$150,000 home.
You have two options:
Buying a $150,000 townhouse in an urban setting
close to public transportation, work and shopping.
Or, you could purchase a larger, detached single-
family home in a suburban area, with longer
commutes to work.
Myers and Gearin 2001 based on NAHB data
Expressed Preference for a Townhouse in the City
Minority Dictatorship of New Construction
Everyone else lives
in existing housing
1% of households
(growing segments)
dictate type of new
construction
Dowell Myers, USC
4.
The Baby Boomer
Sell-Off
Soaring Ratio of Seniors to Working Age
Source: California Department of Finance,
Census Bureau, and Authors calculations, 2010.
U.S.
California
0
5
10
15
20
25
30
35
40
45
1970 1980 1990 2000 2010 2020 2030 2040
Seniors (65+) per 100 Working Age (2564)
Myers 2010
+70%
In California
2010-2030
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
2
0
-
2
4
2
5
-
2
9
3
0
-
3
4
3
5
-
3
9
4
0
-
4
4
4
5
-
4
9
5
0
-
5
4
5
5
-
5
9
6
0
-
6
4
6
5
-
6
9
7
0
-
7
4
7
5
-
7
9
8
0
+
Source: Myers (2007) Immigrants and Boomers, Figure 11.1
B
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0
0

P
o
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a
t
i
o
n
Age
Per 100 People of Each Age in California
Buy
Sell
Average Annual Rates of Buying and Selling
Annual Net Selling Rate at Age 65-69
Source: Dowell Myers and SungHo Ryu, Aging Baby Boomers and the Generational Housing Bubble,
Journal of the American Planning Association (winter 2008)
Myers and Ryu 08
Will Supply Cut Back?
0
1
2
3
4
5
6
7
8
9
1991 2005
Resale
Newly
Built
Annual Home Sales in Millions
Whos Going to Buy Your House?
Myerss Projection for California in 2020
Source: Immigrants and
Boomers, Figure 11.3
N
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b
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B
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L
e
s
s

S
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r
s
Hispanic
Asian and Pacific
Islander
Black
Non-Hispanic White
Net buyers
Net sellers
67, 70, 77, or 90% Heavier
Senior Ratio of Home Sellers
Need for
Bulking Up
the Younger Generation
United States
Cultivating Immigrant Home Buyers
Progress of Each Immigrant Wave Arriving Before 1970, 80, 90, 2000
All
Native-
born
All
Foreign-
born
1960s
Arrivals
1970s
Arrivals
1980s
Arrivals
1990s
Arrivals
Data Source: Dowell Myers & Cathy Liu, Urban Policy and Research, September 2005
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
70 80 90 00
Conclusions
for the
Future
MultiFamily is the New Normal
1. Recognizing and supporting the
renewed growth of young adults
2. Returning to the housing norms of
the 1960s, 70s, and 80s
3. Showcasing better designs for
greater community acceptance
Competitive Strategies on Sell-Off
Fight the rising senior ratio
1. Create elder friendly communities in
suburbs for aging in place and to slow
departures
2. Attract the young with jobs, lifestyle,
good schools, and housing assistance
3. Attract upwardly mobile immigrants
Whats it Mean for
the Three Stories of the
Future?
Resisting Big Brother
Building a Sustainable Future
Housing Our Demographic Future
The Broader Solution
Fortify the younger generation
with costly education
Its our key tax investment
Everyone a College Grad
and a Home Buyer,
a Worker and a Better Taxpayer
Sustainable Cities?
A Fortunate Confluence of the
Housing Demographic Future with
Reductions in Energy & Emissions
1. Density driven by demographics
2. Climate friendly (SB 375)
3. Conserves energy consumption
4. End of sprawl--Livable, compact
development fills demand unmet by
existing single-family sprawl
What Final Conclusions?
Population is not a flat pink line or a steady gray
climb
Demographic change is highly leveraged and
forces turning points in the city
Demography is NOT destiny, but aging happens
The new normal is NOT like the 1990s
Hey, its the 21
st
century
Thank You
Dowell Myers
<[email protected]>
Search for USC popdynamics
For further information,
Also see the references that follow.
Publications Referenced in this Presentation
Myers, Dowell and John Pitkin, Demographic Forces and Turning Points in the American City,
1950 To 2040, Annals of the American Academy of Political and Social Sciences 626 (November
2009): 91-111.
Myers, Dowell and SungHo Ryu, Aging Baby Boomers and the Generational Housing Bubble:
Foresight and Mitigation of an Epic Transition, Journal of the American Planning Association
74, 1 (Winter 2008): 17-33. (Winner of 2008 Award for Best Article in the Journal.)
Myers, Dowell, Promoting the Community Future in the Contest with Present Individualism,
pp. 59-78 in Lewis D. Hopkins and Marisa A. Zapata, eds., Engaging the Future: Forecasts,
Scenarios, Plans, and Projects, Cambridge, Mass.: Lincoln Institute for Land Policy, 2007.
Myers, Dowell, Immigrants and Boomers: Forging a New Social Contract for the Future of
America. New York: Russell Sage Foundation, 2007.
Myers, Dowell and Cathy Yang Liu. The Emerging Dominance of Immigrants in the US Housing
Market 1970-2000, Urban Policy and Research 23, 3 (2005): 347-65.
Myers, Dowell and Elizabeth Gearin, Current Housing Preferences and Future Demand for
Denser Residential Environments, Housing Policy Debate 12, 4 (2001): 633-59.
Myers, Dowell, Demographic Futures as a Guide to Planning: California Latinos and the
Compact City, Journal of the American Planning Association 67 (Autumn 2001): 383-97. Co-
winner of 2001 Award for Best Article in the Journal.
Myers, Dowell, Building the Future as a Process in Time, pp. 62-65 in Metropolitan
Development Patterns: Annual Roundtable 2000, Lincoln Institute for Land Policy, Cambridge,
MA, 2000.