On examining PWC’s Emerging Trends in Real Estate 2017: Canada and the United States 2017, it is surprising that vehicle automation is not discussed in the report, although one mention was made of live/work/play (an adjacent, but structurally very different idea) regarding Raleigh/Durham (p.43). Otherwise, “auto” is only mentioned with respect to real estate value in automakers’ job markets (Charleston (p.42), Louisville (p.43), Knoxville (43), Detroit (p.50)).  The report’s authors have neglected to mention (or perhaps recognize) that the interplay between real estate and automobility is about to be dramatically changed by vehicle automation and this change will influence future investment decisions as well as the value of past investments.

It is not possible to disassociate automobility and real-estate. Automobility is now changing: automated vehicles (AVs) will flatten urbanizations.

Here is why vehicle automation is an emerging trend for real estate:

  1. The AV will combine with housing’s falling affordability to both enable and encourage living farther from work/play – the opposite of live/work/play. The ease with which the live/work/play issue can be addressed within a few days by individual families deciding to buy one or two AVs compared to how communities and planners can address it with decade-long debate, zoning, planning, and building will be so remarkable that the AV (digital) will call more of these shots than will planners (analog).
  2. The AV enables a larger radius for Transit Oriented Development. TOD approaches encourage compact multi-family dwellings and some retail walkable from a transit hub. This is intended to reduce the per-family vehicle count but currently operates only over a modest radius (with regard to a revealed preference for walking over car use) because of the modest distance most people are willing to walk, especially in many weather, climate, and wealth regimes. Given the impending arrival of automated shuttles —minibuses operating at max 40/kph and later improving — we can expect the use of cheap, automated circulators, whether on-demand or scheduled to increase the radius of TOD. This would raise land value over a wider TOD radius while possibly reducing the average building height at the center.

These and related issues and solutions are discussed in this RCCAO report. A follow-on report, describing digital governance solutions for planners facing digital disruption is to be published by the RCCAO in early Fall 2017.

Reading:

https://www.curbed.com/2017/5/16/15644358/parking-real-estate-driverless-cars-urban-planning-development

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