Neighborhood Choice

an Urban & Regional Economics presentation

by Chris Davakis, Brittany Green and Josh Krahenbuhl

How would/did you choose a neighborhood to live?

How do people choose neighborhoods?

• Based on your preferences for…

– Schools/Education• Many funded by taxes of neighborhood

– Crime– Access to public services- tiebout sorting– Transportation Network– People choose to live around similar people- more

comfortable

• Millennial movement to the city• Future forecast of city economy • Communication connections• Social scene• Environmental impact of city

What is important?• More than 90 percent of respondents said

that providing equal chances for all people to get ahead, through educational and economic opportunities

• Racial and ethnic diversity elements of the community

Source: http://www.theatlantic.com/business/archive/2015/03/what-do-americans-prioritize-when-picking-a-place-to-live/387328/

How did people choose neighborhoods in the past?

Neighborhood Choice in the Past

• Migration from urban cities to suburbs beginning in the interwar and postwar eras (after GIs returned home)– Federal government and banks provided millions in loans for

homeowners

• Racial residential segregation during suburbanization– Homeownership primary way Americans accumulate wealth

but…– Redlining-denying mortgage services either directly of through

selectively raising prices to residents of certain areas based on racial or ethnic makeup

• Certain urban immigrant communities (e.g. German, Italian, Polish) limited to tenement housing– Tenement housing-very small apartments with multi-

family dwellings and poor living conditions– Many Americans were unwelcome to immigrants moving

into their communities

Video links

• Tenement Housing– https://www.youtube.com/watch?v=JXnYvJ9aTkw

• Redlining– https://youtu.be/mW764dXEI_8?t=3s

Where would you go to find affordable housing on $20,000 with a family of 4? • How would that change your decisions based on this

information? What would you refuse to give up?

Source: http://www.cbpp.org/research/chart-book-federal-housing-spending-is-poorly-matched-to-need#Five

What influences neighborhood choice now?

How does transportation affect neighborhood choice?

Source: http://www.uspirg.org/sites/pirg/files/reports/US_Transp_trans_scrn.pdf

Neighborhoods of Ohio cities

• Cincinnati composed of 52 • Cleveland composed of 36• Columbus composed of 39

Real Estate/Demographics

• Neighborhood Map

Livability

• Livability Scores

School district • The quality of the school district is one of the first

things home buyers evaluate before making a purchase

• In fact, quality of primary school education is positively correlated with house prices

• A good home in a good school district has the benefit of maintaining its value, which helps in thinking of selling for the future

Source: “Nonlinear Effects of School Quality on House Prices”, Chiodo, Hernández-Murillo, and Owyang, 2010

What do Cincinnati neighborhoods have to offer?

Welcome to Cincinnati!

Source: City of Cincinnati, Planning

Facts about the City of Cincinnati

• Cincinnati has…– the 27th largest metro area in the USA– a lower cost of living than the USA

average

Images taken from http://www.law.uc.edu/sites/default/files/Local%20Housing%20Options.pdf

What do demographic classes seek?

• Young Professionals – An authentic urban experience in hip, edgy

districts• Entry-level Professionals

– Value in the proximity to employment cores/amenities

• Empty Nesters/Never Nesters– Luxury upscale units close to culture and

events

Source: http://choosecincy.com/assets/uploads/files/city_pdf18162.pdf

School district and house prices

• The Village of Indian Hill school district – Rated #1 in the Cincinnati area– House prices in the village

• Wyoming, Sycamore SDs

Source: https://k12.niche.com/rankings/public-school-districts/best-overall/m/cincinnati-metro-area/

• Residents here choose to live in areas with development and growth opportunities

• The City of Cincinnati is committed to focusing on economic development initiatives and investment primarily in the areas of– Downtown– Over-the-Rhine– Uptown

Uptown • the leading job creation center in the City

of Cincinnati

• composed of the neighborhoods CUF, Corryville, Mount Auburn, Clifton

• University of Cincinnati – 2nd largest Cincinnati MSA-employer*

*Based on a definition given here: http://choosecincy.com/datacenter/employers

Over-The-Rhine

• Small businesses• Walkability• Nightlife• Crime• Proximity to the Downtown

Young Professional neighborhoods

– Oakley– Hyde Park– Mount Lookout

Oakley, Cincinnati, OH

Other neighborhoods…

Sources• http://www.nytimes.com/2009/02/23/nyregion/

23partitions.html?_r=2

• http://www.citylab.com/housing/2015/03/why-americas-racial-wealth-gap-is-really-a-homeownership-gap/387427/

Questions?

Thank you!