Will self-driving cars Make the Suburbs Great Again?

The delights of living in a suburb – coming to a self-driver like you in just a few years. Image: Wikimedia Commons.

The future of urban life is the commuter belt. Or so says one economist, who believes technology and transport improvements will help us live better lives on the fringes of cities than we do in the middle of them.

“A city is a technical solution to a problem from the Industrial Revolution,” said Karen Harris, managing director of Bain & Company's Macro Trends Group, at the Slush startup conference in Helsinki last week. “We needed to have lots of bodies clustered to run our cities… it was a genius solution.”

We no longer need to live all clumped together, thanks to improvements in communications and transport (such as self-driving cars – let’s ignore the current realities of Southern) mean. “Why do we assume that urbanisation will continue in a straight line?” she asked.

At the core of this idea is spatial economics – what Harris describes as “the cost of distance”. Look at the cost of sending information. It used to require a stamp to send a note. Now, regardless of how far the message travels, we do it for almost free (if you accept the assumption of internet access as a utility).

But soon the cost of moving goods and people will also fall, helped by faster trains, driverless cars and trucks, and drones, she predicted – you won't mind a longer commute so much if it's fully automated.

A profoundly un-sexy self-driving car from Google. Image: Marc van der Chijs / Flickr.

Of course, we've heard variations on this argument before. The rise of the internet meant we could all run small businesses from a beautiful valley in Wales – shame the broadband speeds are astonishingly bad – and video conferencing meant we never needed to travel for a meeting again, instead Skyping in from our over-sized kitchens or massive, manicured gardens. Yet the past few years have seen more younger people crowd into cities than ever before, and in the UK the rate of urbanisation has continued its steady climb. And we all still have to attend meetings.

But the shift is starting to happen in some countries, Harris reports. “In the US, for example, where the census has great data, we've seen 2 per cent of the population move away from city centres to the outer edge of the commuting belt,” she said. “In France, that's 3 per cent. Wherever there’s lots of land, in advanced economies, we’re seeing people taking advantage of the falling cost of distance.”

The view from your office window? Image: Wikimedia Commons.

Those are relatively small shifts, and Harris admitted that it's “harder in some places than others”. Consider London. If you're moving from zone three to the edge of Oyster coverage, it likely has more to do with the insane home prices in the capital than the falling “cost of distance”. If you can't afford to live in the centre, you have no choice but to reside further out and suffer a commute, regardless of technology innovations that may make it slightly less painful.

That's why such cities are increasingly the province of the young, as they don't mind living “piled in a flat”, Harris said, as well as the rich and empty nesters. But what about everyone else? Are we doomed to live as zombie commuters, returning to dull suburban enclaves each night?


Harris' argument is that life on the fringes of a metropolis can be better, pointing to “new village” developments on the outskirts of American cities that have a variety of retail and entertainment options, as well as local work opportunities – and a cheaper cost of living than the middle of a city. “People who right now commute long distances, crowd into perhaps suburbs, can live in places that are more pleasant,” she argued.

So no zombie commuters? “The Walking Dead is actually filmed in a 'new village', a developer-built community,” she said. “But it has the elements that we all crave.

“I'm not saying leave cities and live in a cave with a cow.” She notes the wealthy people live in walkable high streets, with a variety of amenities, saying the rest of us should be offered the “ability to express that desire”.

A more sexy self-driving car from Mercedes-Benz. Image: Mercedes-Benz / Vimeo.

Some of the technology that will enable this is already here, but others will take years if not decades to arrive. Driverless cars face engineering and regulatory hurdles, but could make travelling further distances to get to a train station or to the office more palatable. And once the necessary infrastructure is in place to give us urban-feeling lives in suburban locations, the number of people moving out will tick above those 2 per cent and 3 per cent figures, Harris predicted.

However, she noted social change is faster than technological change. “A movement away from cities could happen much more quickly than we think and we expect,” Harris predicted.

We may get to the suburbs faster than driverless cars can take us there.

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Is Britain’s housing crisis a myth?

Council housing in Lambeth, south London. Image: Getty.

I’ve been banging on about the need for Britain to build more houses for so long that I can no longer remember how or when it started. But at some point over the last few years, the need to build more homes has become My Thing. People ask me to speak at housing events, or @ me into arguments they’re having on Twitter on a Sunday morning in the hope I’ll help them out. You can even buy a me-inspired “Build More Bloody Houses” t-shirt.

It’s thus with trepidation about the damage I’m about to do to my #personal #brand that I ask:

Does Britain actually have enough houses? Is it possible I’ve been wrong all this time?

This question has been niggling away at me for some time. As far back as 2015, certain right-wing economists were publishing blogs claiming that the housing crisis was actually a myth. Generally the people who wrote those have taken similarly reality-resistant positions on all sorts of other things, so I wasn’t too worried.

But then, similar arguments started to appear from more credible sources. And today, the Financial Times published an excellent essay on the subject under the headline: “Hammond’s housebuilding budget fix will not repair market”.

All these articles draw on the data to make similar arguments: that the number of new homes built has consistently been larger than the number of new households; that focusing on new home numbers alone is misleading, and we should look at net supply; and that the real villain of the piece is the financialisation of housing, in which the old and rich have poured capital into housing for investment reasons, thus bidding up prices.

In other words, the data seems to suggest we don’t need to build vast numbers of houses at all. Have I been living a lie?

Well, the people who’ve been making this argument are by and large very clever economists trawling through the data, whereas I, by contrast, am a jumped-up internet troll with a blog. And I’m not dismissing the argument that the housing crisis is not entirely about supply of homes, but also about supply of money: it feels pretty clear to me that financialisation is a big factor in getting us into this mess.

Nonetheless, for three reasons, I stand by my belief that there is housing crisis, that it is in large part one of supply, and consequently that building more houses is still a big part of the solution.

Firstly I’m not sold on some of the data – or rather, on the interpretation of it. “There is no housing crisis!” takes tend to go big on household formation figures, and the fact they’ve consistently run behind dwelling numbers. Well, they would, wouldn’t they? By definition you can’t form a household if you don’t have a house.

So “a household” is not a useful measure. It doesn’t tell you if everyone can afford their own space, or whether they are being forced to bunk up with friends or family. In the latter situation, there is still a housing crisis, whatever the household formation figures say. And there is plenty of anecdotal evidence to suggest that’s the one we’re living in.

In the same way I’m not quite convinced that average rents is a useful number. Sure, it’s reassuring – and surprising – to know they have grown slower than general prices (although not in London). But all that figure tells you is the price being paid: it doesn’t tell you what is being purchased for that payment. A world in which renters each have their own property may have higher rents than one in which everyone gets one room in an over-crowded shared flat. It’s still the latter which better fits the label “housing crisis”.

Secondly, I’m entirely prepared to believe we’ve been building enough homes in this country to meet housing demand in the aggregate: there are parts of the country where housing is still strikingly affordable.

But that’s no use, because we don’t live in an aggregate UK: we live and work in specific places. Housing demand from one city can be met by building in another, because commuting is a thing – but that’s not always great for quality of life, and more to the point there are limits on how far we can realistically take it. It’s little comfort that Barnsley is building more than enough homes, when the shortage is most acute in Oxford.

So: perhaps there is no national housing crisis. That doesn’t mean there is not a housing crisis, in the sense that large numbers of people cannot access affordable housing in a place convenient for their place of work. National targets are not always helpful.


Thirdly, at risk of going all “anecdote trumps data”, the argument that there is no housing crisis – that, even if young people are priced out of buying by low interest rates, we have enough homes, and rents are reasonable – just doesn’t seem to fit with the lived experience reported by basically every millennial I’ve ever met. Witness the gentrification of previously unfashionable areas, or the gradual takeover of council estates by private renters in their 20s. 

A growing share of the population aren’t just whining about being priced out of ownership: they actively feel that housing costs are crushing them. Perhaps that’s because rents have risen relative to wages; perhaps it’s because there’s something that the data isn’t capturing. But either way, that, to me, sounds like a housing crisis.

To come back to our original question – will building more houses make this better?

Well, it depends where. National targets met by building vast numbers of homes in cities that don’t need them probably won’t make a dent in the places where the crisis is felt. But I still struggle to see how building more homes in, say, Oxford wouldn’t improve the lot of those at the sharp end there: either bringing rents down, or meaning you get more for your money.

There is a housing crisis. It is not a myth. Building more houses may not be sufficient to solve it – but that doesn’t meant it isn’t necessary.

Jonn Elledge is the editor of CityMetric. He is on Twitter as @jonnelledge and also has a Facebook page now for some reason. 

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