FAQ

What is location efficiency?

While the concept of energy efficiency is a familiar term, locations can be efficient too. Compact neighborhoods with walkable streets, access to transit, and a wide variety of stores and services have high location efficiency. They require less time, money, and greenhouse gas emissions for residents to meet their everyday travel requirements.

The savings add up for households and communities. Transportation costs can range from 15% of household income in location efficient neighborhoods to over 28% in inefficient locations. Greenhouse gas emissions also fluctuate, depending on household reliance on costly, carbon-intensive automobile travel.

Why develop an H+T Index?

There are many data sources that provide neighborhood level data on housing costs. However there is no national data source for household transportation costs at this scale. CNT developed the H+T Index to provide a single source of information on housing and transportation costs at the neighborhood level for metro areas across the United States.

How are housing costs derived?

CNT does not derive housing costs. The value that CNT brings to the H+T Index is the transportation cost model. Housing costs come from the American Community Survey and are calculated as the average of Selected Monthly Owner Costs and Gross Rent scaled by the percentage of owner-occupied housing units with a mortgage and renter occupied housing units with cash rent.

How was the 45% affordability benchmark developed? How does it differ from the traditional view of affordability?

Traditionally, a home is deemed affordable if its costs consume no more than 30% of a household’s income. This measure, however, ignores transportation costs—typically a household’s second largest expenditure—which are largely a function of the area in which a household chooses to locate. Based on research in metropolitan areas ranging from large cities with extensive transit to small metro areas with extremely limited transit options, CNT has found that 15% of the Area Median Income (AMI) is an attainable goal for transportation affordability. By combining this 15% level with the 30% housing affordability standard, CNT recommends a new view of affordability, one that combines housing and transportation costs and consumes no more than 45% of household income.

What is a “typical regional household” and why is affordability reported from this perspective?

The Regional Typical Household assumes a household income that is the median income for the region, the average household size for the region, and the average commuters per household for the region. An important aspect of the H+T Index is that transportation costs are modeled for the "typical" household in a region, or the household represented by these three values.

By fixing income, household size, and commuters, the model controls for the impact of these variables on transportation costs. Differences in transportation costs are therefore a result of neighborhood characteristics and variation in the built environment. When variables are shown as a percent of income, this median income value is used. Therefore, the variable can be interpreted as the cost impact of a given location on the average household in the region.

CNT has modeled data for three typical households, each with a different income level. The first is the Regional Typical Household, with its assumptions described above. Second is the Regional Moderate Household, which assumes a household income of 80% of the regional median, the regional average household size, and the regional average commuters per household. Third, the National Typical Household assumes a household income of $51,425 (the national median household income), a national average household size of 2.6, and a national average number of commuters per household of 1.15.

What characteristics of the built environment are used to model transportation costs?

Residential density, gross density, average block size, intersection density, job density and the Transit Connectivity Index are the built environment variables used to model transportation costs. Please see the methods section for a detailed description of the transportation cost model.

How is walkability measured?

Measures of street connectivity have been found to be good proxies for pedestrian friendliness and walkability. Greater connectivity, from more streets and intersections, creates smaller blocks, and tends to lead to more frequent walking trips. The model uses average block size and intersection density as proxy measures for walkability.

Does the H+T Index account for qualitative characteristics of a neighborhood such as quality of schools or crime rates?

The H+T Index does not quantify subjective characteristics such as crime and school quality that might factor into a person’s location decision. The Index’s contribution is to focus on the interplay between the two largest portions of most household budgets: housing and transportation costs.

Is the cost of parking considered in the model?

The model does not currently incorporate the cost of parking and other miscellaneous transportation expenses, including tolls and taxis.

What are core based statistical areas (CBSAs)?

Metropolitan and micropolitan statistical areas are geographic entities defined by the Office of Management and Budget (OMB) for use by federal statistical agencies in collecting, tabulating, and publishing national statistics. The term Core Based Statistical Area (CBSA) is a collective term for both metro and micro areas.