• 16
Would you believe that there's a connection between owning a car and having to foreclose on your home? A study by the Natural Resources Defense Council found that yes, indeed, there is. At least, a relationship was found in the three areas that the study looked at: San Francisco, CA, Chicago, IL and Jacksonville, FL. While the correlation wasn't giant, it does seem that there's something to the idea of "location-efficient neighborhood design" being good for housing stability (read the PDF).

Location-efficiency is "a measure of the transportation costs in a given area," and it includes not just car ownership, but also if the area has reasonable public transportation. Basically, if an area is a "compact" neighborhood with good bus or rail service – and so having a car is not required – then the corresponding foreclosure rate was probably lower. One possibility is that the money saved by not owning your own car (more details here) can mean more money to spend on housing. As Autopia points out, there could be a lot of other reasons for this connection as well, but for the car-sharing crowd, this is another reason to think about staying away from owning a vehicle when other transportation options are available.

[Source: Autopia | Image: taberandrew - C.C. License 2.0]

I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.

    • 1 Second Ago
      • 5 Years Ago
      So how do we correct for the massive sprawl that car ownership gave rise to?
      • 5 Years Ago
      This article is actually relevant-

      What happens when you let land developers and real estate agents dictate nation al public transportation policy?

      It should go about as well as letting wall street and mortgage brokers dictate economic policy.

      That all went really well last, didn't it????

      • 5 Years Ago
      "Basically, if an area is a "compact" neighborhood with good bus or rail service – and so having a car is not required – then the corresponding foreclosure rate was probably lower."

      Well, basically, if I didn't have food bill, or a tax bill, or utility bills, I would be able to pay my mortgage a lot easier. So if I want to live far away from work and live in nice house, maybe I will forgo a brand new car, or put off buying that 60" HDTV. It's about making choices folks not the availability of one government service or another.
      • 5 Years Ago
      How TRUE!, its why when gas went to over $4 bucks a gallon last year foreclosures went up with it.
      • 5 Years Ago
      Not so convincing.
      • 5 Years Ago
      ^^ Restrict land usage.
      • 5 Years Ago
      @Jon: Far too many do, which contributed to me giving up years ago. :)
      • 5 Years Ago
      there is lies, dam lies and statistics. Know the difference between correlation and causation?
      If you had $10 million in the bank, and the market dropped 33%, you still have over $6 million left. IMHO, the majority of the people that got forclosed should have not owned a home. No down payment? ARM loan? no problem! Many people over extended themselves to get into a home. There were still a lot of people that lost their jobs, that was unforeseen and unfortunate. I can understand those. Why would you sign a 30 year loan without knowing the interest? that's just crazy. Same thing as I see the guy leaving in a crappy apartment with and older 5 series bmw with $3K wheels. Bad financial choices.
        • 5 Years Ago
        "by people who rent, not won"

        You are correct on both counts; renting and taking public transportation constitute not winning.

        I love the idea of public transport; I utilized it heavily when I was a poor college student, but taking 45 minutes to get from campus to home when I could have walked in 40 and driven in 3 made it all a little frustrating. Throw in the random homeless guy or crazy cat lady who both smell like some sort of urine, arguable for similar reasons, and you have a recipe for low ridership.

      • 5 Years Ago
      I put on 260 miles on my car in the past month, and that was without the use of public transportation. I just choose not to live in the 'burbs.
    • Load More Comments