Study Questions Whether Transit-Rich Neighborhoods Lower Household Transportation Costs

A study published in Housing Policy Debate by Michael Smart and Nicholas Klein, “Complicating the Story of Location Affordability,” questions whether families in transit-accessible neighborhoods spend significantly less on transportation. The study shows that income, wealth, and household composition are better predictors of transportation expenses than neighborhood transit characteristics.

The location-affordability hypothesis asserts that households living in transit-accessible, compact, and walkable neighborhoods spend less money on transportation, giving them more resources to spend on housing. To test this hypothesis, the authors analyzed the transportation expenditures, neighborhood characteristics, and household composition of thousands of families from 2003 to 2013. They measured transit-accessibility as the number of jobs accessible by public transportation within 30 minutes of the census tract. 

Family income, family wealth, and household composition were stronger predictors of transportation expenses than transit-accessibility. Families in high-transit neighborhoods spent less on transportation than families in low-transit neighborhoods ($5,741 per year vs. $8,021 per year), but they also had, on average, lower incomes, less wealth, greater likelihood of zero or negative wealth, fewer family members, and fewer cars than families in low-transit neighborhoods. These factors could explain the lower transportation expenses. The authors also found that families who moved to higher-transit neighborhoods did not appear to significantly lower their transportation costs. The same was true when the analysis was limited to poor families, who would benefit the most from lower transportation costs.

In a more detailed analysis, the authors calculated that moving to a location with nearly triple the number of jobs within 30 minutes by transit lowers annual transportation costs by $125 ($10 per month). As an extreme example, moving from a neighborhood with access to 1,000 jobs within 30 minutes by transit to one with access to 268,000 jobs would lower transportation costs by approximately $700 annually (or $58 per month).

The authors conclude that living in transit-rich neighborhoods provides many benefits with regard to access to jobs, education, shopping, and other services - an important consideration for lower-income households less likely to own a car. One should not assume, however, that families will significantly lower their transportation costs by moving to these areas.

 “Complicating the Story of Location Affordability” is available at: