Witold Rybczynski describes some of the innovative features of the first modern housing developments, the Levittowns, that made the homes so popular yet affordable:
Many of the design innovations of the Levittowner were Alfred’s own ideas. A folding basswood screen that slid on a metal track separated a so-called study-bedroom from the living room, allowing the space to be open or closed. Thermopane (insulated glass) covered a large section of the living-room wall overlooking the garden. The kitchen had a large window facing the street — an early example of a “picture window.” High window sills in the bedrooms provided privacy — and reduced cost. Locating the bathroom and the kitchen on the street side reduced the length of piping to the street mains. There was no mechanical room; instead, a specially designed furnace fit under the kitchen counter, its warm top doubling as a hot plate. The Levitts were careful to give penny-pinching buyers of the Levittowner touches of luxury: the purchase price included a kitchen exhaust fan, an electric range, a GE refrigerator, and a Bendix washing machine. The Country Clubber added a clothes dryer.
A two-way fireplace was located between the kitchen and the living room. Two-way fireplaces were a standard Usonian feature, but while the Levittowner had a low, spreading roof and clean lines, no one would mistake it for a Frank Lloyd Wright house. Yet, although Alfred Levitt’s design looks unremarkable today, in fact this early example of the so-called ranch house represented a revolution in domestic design. One-story living was new to most Americans, as was the open plan combining kitchen, eating space, and living room. The undecorated exterior was unabashedly modern. Picture windows had no precedents in traditional homes; neither did carports. Instead of brick or wood, the exterior walls of the Levittowner were covered with striated sheets of Colorbestos (asbestos cement), which had been developed especially for the Levitts by the Johns Manville Corporation. With integral color that didn’t require painting, this was an early example of low-maintenance siding.
We don’t use asbestos cement anymore, and some of the other novelties, such as under-floor heating, proved troublesome (as they did in the Usonians), but the Levitt brothers’ achievement remains impressive. They introduced the American public to modern production building and proved that standardization, mass production, and technical innovation could be successfully — and profitably — used by commercial builders to produce houses for a large market.
The standardization, mass production, and technical innovation of the Levittowns didn’t go away, so why can’t we build an affordable house?
Would it be possible to build a modern version of the affordable Levittowner? It would probably be a small house, closer to the 1,000 square feet of Alfred Levitt’s design than the 2,469 square feet that is today’s national average for new houses.
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What would such a house sell for? In 1951, the price of the original Levittowner ($9,900) was three times the national average annual wage ($3,300). In 2008, with an estimated national average wage of $40,500, a similarly affordable house should have a sticker price of $121,500. Yet according to the Census Bureau, even in the current declining market the median price for a new single-family house in the first quarter of 2008 approached twice that: $234,100. So, the price of a modern Levittowner would have to be nearly 50 percent cheaper than that of today’s average new house. Easy, you say, just make the house 50 percent smaller, about 1,200 instead of 2,469 square feet. But it’s not that simple. In most metropolitan areas, the selling price of such a house would still be more than $200,000, considerably more than $121,500.So what’s keeping housing prices high? It’s not the size, and it’s not the construction costs, either. The Levittowner cost $4–$5 per square foot to build in 1951, equivalent to $30–$40 per square foot in 2008. That is approximately what an efficient, large-scale production builder spends today.
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What’s driving the high cost of houses today is not increased construction costs or higher profits (the Levitts made $1,000 on the sale of each house), but the cost of serviced land, which is much greater than in 1951. There are two reasons for this increase. The first is Proposition 13, the 1978 California ballot initiative that required local governments to reduce property taxes and limit future increases, and sparked similar taxpayer-driven initiatives in other states. Henceforth, municipalities were unable to finance the up-front costs of infrastructure in new communities, as they had previously done, and instead required developers to pay for roads and sewers, and often for parks and other public amenities as well. These costs were passed on to home buyers, drastically increasing the selling price of a house.The other reason that serviced lots cost more is that there are fewer of them than the market demands. This is a result of widespread resistance to growth, the infamous not-in-my-backyard phenomenon, which is strongest in the Northeast, California, and the Northwest. Communities in growing metropolitan areas contend with increased urbanization, encroachment on open space, more neighbors, more traffic, and more school-age children. Roads have to be widened, traffic lights added, and schools expanded, all of which lead to higher taxes. Voters commonly respond to these ill effects of growth by demanding restrictions on the number of new houses that can be built. Usually this is achieved by tightening zoning, invoking environmental constraints, and generally drawing out and complicating the permit process. It is no coincidence that house prices are highest in the Northeast, California, and the Northwest. According to the research of economists Edward Glaeser of Harvard and Joseph Gyourko of the Wharton School, since 1970 the difficulty of getting regulatory approval to build new homes is the chief cause of increases in new house prices. In other words, while demand for new houses has been growing, the number of new houses that can actually be built has been shrinking.
The most common tactic communities use to restrict development is to zone for large lots. In many parts of the country, the median size of new lots now exceeds one acre; by contrast, the 70-by-100-foot Levittowner lot covered less than one-sixth of an acre. For the neighbors, requiring large lots has two advantages: It limits the numbers of houses that can be built and, since large lots are more expensive, it ensures that new houses will cost more, which drives up surrounding property values. But reducing development has another, less happy effect: It pushes growth even farther out, thus increasing sprawl. While large-lot zoning is often done in the name of preserving open space and fighting sprawl, in fact it has the opposite effect.