Reuters Money

After the housing bust, what’s next?

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Beyond the double-dip U.S. housing recession, is there a future for the American home market? What I see emerging as growth magnets are established city enclaves and “new urbanist” communities that resemble old-style neighborhoods without the sprawl. They are close to public transportation, walkable and loaded with culture and amenities. They personify the new American dream.

Unfortunately, I also see the slow death of the “spurb,” a word I needed to coin for my book The Cul-de-Sac Syndrome to describe sprawling, car-addicted ex-urban areas far from central cities. While I think many inner suburbs will do fine and prosper, the next wave of real-estate growth favors vibrant cities and energy-efficient communities.

Before I eulogize the spurb, it’s time for a serious housing policy discussion. I agree with Edward Glaeser, Harvard economist and author of Triumph of the City, that the post-war government homeownership policy has over-subsidized suburban growth at the expense of cities. It’s outdated, wasteful and needs to change.

“Homeownership subsidies were a bribe to leave cities for the suburbs,” Glaeser told the Congress for the New Urbanism on June 3. “We need to rethink our fetish for suburban homeownership. It’s risk-enhancing, regressive and bad for the environment.”