The Location Affordability Portal Helps Families, Urban Planners, and Policymakers
Housing and transportation are the two largest costs that families face, accounting for almost half of the average American household’s income. These costs often prevent families from adequately saving for retirement or educational expenses, while leaving them financially unprepared for unforeseen events.
Not only are transportation and housing costs significant, but they are also dependent on one another. For example, as families seek to reduce their housing costs, they often end up with longer commutes, more total driving, less access to public transportation, and increased transportation costs. In fact, for every dollar a working family saves on housing, it spends 77 cents more on transportation, according to research from the Center for Housing Policy.
Despite the connection between these costs, housing and transportation policy have typically remained siloed. But the new Location Affordability Portal, developed jointly by the Departments of Transportation and Housing and Urban Development, marks a major step toward integrating transportation and housing policy with the common goal of supporting affordable living solutions.
The Location Affordability Portal contains two resources available to both families and policymakers. The Location Affordability Index is a map-based tool that shows the percentage of income spent on housing and transportation costs for different family types. Because the data are gathered at the census block level, families can even compare the affordability of different neighborhoods in the same city. A second tool, the Transportation Cost Calculator, allows users to customize inputs based on their family to determine the overall affordability of different living option.
The Location Affordability Portal was created with input from both academics and real estate professionals. Using statistical regression modeling, the government staff was able to determine the housing and transportation costs of different neighborhoods regardless of who lives there, which allows for comparisons of different family types in different locations. Using inputs such as rent, car ownership percentage, transit usage, and the number of miles traveled by car each year, the Location Affordability Portal produces reliable estimates of transportation and housing costs in various areas.
These new tools empower families to make informed living decisions, balancing cheaper housing with potentially higher transportation costs. By using the Location Affordability Index to find the most affordable areas on a map, and later using the Transportation Cost Calculator to get a customizable estimate of specific locations, families can constrain housing and transportation costs to a set portion of their budget, making it easier to save for retirement, college, and unforeseen expenses.
Urban planners and policymakers can also use the Location Affordability Index to identify potentially affordable areas, if not for their high transportation costs. Through targeting these communities with transit solutions and economic development, planners can connect affordable housing to cheap transportation options and job opportunities, leading to more affordable neighborhoods.
The Departments of Transportation and Housing and Urban Development have taken a critical step toward addressing the major challenge that transportation and housing costs place on families across the country. By informing households of the costs they are likely to face in various neighborhoods, and alerting regional planners of areas that require greater transit investment, the Transportation Affordability Portal can support affordable housing, reliable transportation, and economic opportunity.
John Craig is a Research Assistant in the Economic Policy department at the Center for American Progress.
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