Here’s an interesting stat: Since mid-2005, Americans are driving less — much less, especially younger folks. You know, the next generation of home buyers?
What’s notable is that — unlike the last time there was a drop in driving, back in the 1980-84 recession — this time the drop appears to be much longer lasting. It’s been 92 months already.
According to the Frontier Group, which did the study, the trend is most noticeable among young people.
From 2001 and 2009, the average annual number of vehicle-miles traveled by young people (16 to 34-year-olds) decreased from 10,300 miles to 7,900 miles per capita – a drop of 23 percent.
That’s a huge drop, that 23 percent. Instead of driving, they’re biking (24% more than in 2001), walking (16% more), and taking public transportation (40% more).
That means they’re looking for places to live that are near reliable public transit and that have high walkability scores. Suburbs and their drive-everywhere mentality don’t fit in their lifestyle.
There are lots of potential reasons for the change in habits.
Cars and car ownership are more expensive — think payments, gas, insurance, and upkeep, with monstrous student-loan payments on top of it all.
But it’s not just about the expense. The study found that “The trend toward reduced driving, however, has occurred even among young people who are employed and/or are doing well financially.” (Maybe they’re “doing well financially” because they’re smart about what they spend their money on.)
Technology, too, makes a difference. It can substitute for some car trips — why waste time driving to go shopping when Amazon is a few clicks away? — and it can make using public transportation easier, when you can check the status of buses and trains in real time.
But let’s say it is mostly a financial motivation. Even when that’s taken out of the equation, many will find that car ownership is more of an annoyance than a necessity. If you can walk or ride where you need to go, why take on a huge responsibility?
All things to keep in mind as you look at your business’s future, and when you think about how transportation issues affect real estate.