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Transportation costs are a wild card in housing affordability, study says

Published: Wednesday, Feb. 29, 2012 10:21 a.m. CST

(MCT) — Transportation costs per household in the Chicago area are among the lowest in the U.S., but those expenses are increasing dramatically for families who live in the outer suburbs, according to a new study released Tuesday.

Overall, the Chicago area, northwest Indiana and southern Wisconsin ranked No. 4 — behind New York, San Francisco and Los Angeles — in the housing and transportation affordability index released by the Chicago-based Center for Neighborhood Technology.

The average annual transportation costs per household were $12,311 for Chicago-area families during 2005-09, the center found, using data based on the American Community Survey.

Household transportation costs in the New York area were $10,158 a year for the same period. In comparison, the typical household in the Nashville area, which ranked No. 50 on the list among large regions, spent $14,854 annually.

But even in the Chicago area, which is served by three mass transit systems, transportation costs vary widely based on where people live, researchers for the center said.

In Chicago's transit-rich Ravenswood neighborhood, where there is an average of one automobile per household and 42 percent of commuters use transit to travel to work and other activities, yearly transportation costs averaged $9,012 in the five-year period studied, the center determined.

Households in Marengo in McHenry County incur an average of $15,888 in transportation costs each year, the study found. Each household in Marengo, where transit ridership is less than 1 percent, also logs an average of 24,438 miles per year in their cars, versus 12,150 miles annually in Ravenswood, the center said.

When people are looking for a place to live, taking into account both housing and transportation costs will change the affordability outlook significantly, said Scott Bernstein, the center's president.

"Housing costs drop as people move farther out, but it causes higher transportation costs,'' Bernstein said. He said living on the outskirts of the metropolitan area increases the need to "own too many cars'' and makes families more susceptible to rising gas prices.

Some 69 percent of neighborhoods in the Chicago area are considered affordable under the traditional definition of housing affordability: rent or mortgage payments consuming no more than 30 percent of household income, the study said. But only 42 percent of the neighborhoods are considered affordable when housing and transportation costs are measured, it said.

"This produces a net loss of 1,718 neighborhoods where a typical family could afford to live,'' the study said.

The study also found that it is more difficult for a typical household in the U.S. to find an affordable place to live compared to a decade ago because incomes increased about half as much as transportation and housing costs since 2000.

Only 28 percent of U.S. communities are affordable for typical households when transportation costs are considered along with housing costs, the study said. Transportation costs are the second-largest expense in a family budget, the study found.

The center's analysis is at http://htaindex.cnt.org. The transportation and housing affordability index covers almost 180,000 neighborhoods across the country, allowing users to look at regions and zoom in at the community level.

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