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Here's where you'll live when self-driving cars rule the roads

MarketWatch logo MarketWatch 10/27/2017 Andrea Riquier

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Video by The Washington Post

It’s 7 a.m. on a Monday morning in 2037.

As you start your 60-mile commute, you wonder if there’s enough time to get everything done — meeting prep, scheduling your kid’s appointment, expense reports — and still sneak in a nap. Since the U.S. car fleet went fully automated a few years ago, the speed limit has increased and congestion has eased, so your trip will take less than an hour.

Today’s cars and trucks aren’t just faster and more efficient. Their very shapes have changed, turning them into spaces to work or rest as you travel.

They’re also safer — so much so that municipalities have cut police and first responder budgets in half. Auto insurance costs a few dollars a year. And many people now use shared “transportation as a service” networks instead of owning a vehicle, saving them thousands.

But some of the automated revolution’s most profound impacts aren’t about transportation at all. How and where Americans live — their homes, communities and housing markets — have also been transformed.

Graphic: Automation will make longer commutes feasible

MarketWatch asked housing, real-estate and transportation experts to help illustrate those coming shifts. None had a crystal ball, but they’ve all thought extensively about the effects automated vehicles will have on housing. 

The details of their visions varied, but the big picture was largely consistent: They agree that the high-tech innovation brought about by autonomous vehicles will be deeply transformative, though in some ways also strangely similar.

Many Americans will live in densely packed cities, but most of us will still head for the suburbs in search of backyards, an extra bedroom, and fresh air. We’ll use commuting time for work: No one predicts the “death of distance” — the idea that we’d rarely leave our homes again — that accompanied the internet’s early rise.

None of our experts predicted shifts so futuristic that they seemed radical, like a drone helipad for every home. But the transitions they do envision may be more revolutionary than we realize now.

Get ready for more real estate devoted to people and green space, rather than cars; for more options for housing in different kinds of communities; and for the possibility of connecting people and regions that have often been left out.

a view of a city © Provided by Dow Jones & Company, Inc.

Cities, suburbs and exurbs will still exist — but they’ll look different

Our experts predicted that cities will remain popular, growing denser as space now devoted to cars will be reclaimed by people.

But automated technology will also push people out of town, they said. Taylor Mammen, a managing director with real estate advisory firm RCLCO, said automation will drive a “renaissance” of many suburbs because “a lot of people, all other things equal, would rather not live on top of their neighbor.”

Of course, when we contemplate places to live, we often consider community, rather than geography. Many of today’s affluent, desirable cities and towns boast strong school systems and cultural scenes that follow — or precede — well-educated residents with good incomes and high expectations.

“Driverless cars should strengthen quality suburbs,” said Mammen — those that offer high-quality housing, outdoor space, and recreational and cultural amenities.

As Americans can be choosier, he said, “they probably harm suburbs that continue to exist today because they offer a reasonable commute to job centers but have nothing else going for them.”

Meanwhile, Americans will look beyond existing suburbs as technology makes travel faster and easier. People of means have always flocked as far away from urban centers and jobs as existing technology allows, notes Ralph McLaughlin, chief economist for Trulia.

In the 19th century, new public transportation systems allowed people to live in the first “inner-ring” suburbs. In the 20th, the interstate highway system spawned today’s car-centric commuter suburbs. The transportation revolution of this century will take Americans even further from city centers, McLaughlin believes.

Some analysts expect more of the sprawl we experience now, in which people move ever-further from job centers, trading affordable housing for long, emission-heavy commutes.

But in an automated future, a new influx of residents could transform exurban areas — say Stockton, Calif., the epicenter of the “drive until you qualify” boom and bust — into vibrant, livable communities with clean, productive commutes, Mammen suggested. 

McLaughlin believes the most interesting transformations won’t be in the exurbs of today, but in smaller cities that were built before cars dominated, and which likely still have walkable — if currently partially vacant — downtowns that can be revitalized.

And he thinks the new technology will open up entirely new housing possibilities. People who work in San Francisco and live in dense, close-by suburbs like Redwood City, he said, may say “I could stay here, or I could commute to Napa — to wine country.”

Graphic: Where might you live in 2037?

Such rosy visions are grounded in an uncomfortable present: Many Americans currently live in communities that once supported residents with ample jobs, but no longer do. 

Missy Cummings, an engineer and former military pilot who is director of Duke University’s Humans and Autonomy Lab, looks at the rural areas in between North Carolina’s booming job centers of Raleigh and Charlotte and sees a policy problem driverless technology can solve.

Cummings believes the promise of on-demand point-to-point transport that driverless technology offers is far more compelling than existing services such as light rail, which is expensive, labor-intensive to construct, and has a mixed track record.

“I’m trying to get North Carolina and other states to think about, ‘What does it mean for light rail if driverless cars get here first?’” Cummings said. “Eastern North Carolina has really struggled economically — foreclosures, the jobs just aren’t there. If we could get more mobile forms of transportation, it would change things.”

Greater accessibility can also benefit the elderly. “Once you lose your driver’s license you have to move,” said John Burns, CEO of John Burns Real Estate Consulting and author of “Big Shifts Ahead.” 

Burns sees the technology posting challenges for assisted living communities. “If you can get yourself to the grocery store, the doctor’s office, that’s a game-changer,” he said.

More independence and better quality of life may come with a drawback, though: Older people staying in their homes longer, Burns said, may make it more harder for younger families to trade up to their own “forever homes.”

One of the biggest changes the self-driving revolution will bring will be felt in all kinds of communities, from the most urban to the most rural: Cars won’t hog our attention, time, or space the way they do now.

Downtown areas will no longer need to devote prime real estate to parking. Instead, many assume, autonomous vehicles — whether shared and subscription-based or personally owned — will hover a few miles away, to be quickly summoned when needed.

Americans now own roughly 240 million passenger vehicles, which sit idle roughly 95% of the time — and we’ve got, by best guess, roughly 800 million parking spaces to accommodate them all. That’s likely to change.

Graphic: The suburbs without personal cars

In urban spaces, parking garages and lots will be repurposed for housing. Two-car garages attached to single-family houses, meanwhile, will become one-car garages. That extra space may be converted into an in-law apartment or reclaimed for grass, trees, and gardens.

Across America, said Burns, we can expect to see “a lot less asphalt.”

How cars — and car ownership — will evolve

People who think about self-driving technology are divided over a big question: Whether we’ll own our own cars, as most do now, or share them. Robin Chase, who founded the sharing service Zipcar, framed that question as “heaven or hell” in an influential article a few years ago.

Most of our experts thought the future would incorporate both options. Thomas Hoban, president of Florida-based developer Kitson & Partners, is developing Babcock Ranch, a 19,500-home community near Fort Myers. He expects many of his future owners to own or use automated vehicles; his community will include an “Uber-like” fleet of shared vehicles.

But he and others also expect many people to own cars. “People desire space and privacy,” said McLaughlin, and anyone with the means will want as much as possible.

“Maybe 80% of people will drive in with their own car, but maybe people in the lower tier opt for the subscription model,” he said. “Maybe you can let that [automated vehicle] be an Uber on its down time or do errands for you. If it sits idle, well that’s a premium you may choose to pay. It’s your room.”

But perhaps not surprisingly, the companies at the forefront of the ride-sharing movement believe car ownership will be replaced by ride-sharing. 

“The question I would have for most people is, ‘Why have a car?’” said Taggart Matthiesen, direct of product for Lyft. “Why own the hard asset, the vehicle, have to pay the insurance and gas, as opposed to being part of a service?”

Matthiesen has lots of ideas on how a subscription service for transportation could work in less dense areas. Commuters might take a high-speed vehicle — perhaps a train or bus — to the edge of a city, he suggests, then pick up one of a fleet of roaming automated taxis to finish the trip.

Andrew Salzberg, who runs transportation policy for Uber, is “bullish on the probability of self-driving networks working well.” But he also recognizes that for many Americans, it’s hard to share cars. Both acknowledge that a lot of work will need to go into creating a fully shared future. 

Many questions, meanwhile, remain. How will shared fleets serve lower-density suburban and rural communities? Will successfully managing rush-hour commutes require people to stagger work hours or pay congestion fees? And while the idea of private companies collaborating with public transit agencies sounds promising, doesn’t the idea of a multi-connection commute run counter to the idea of a single, productive automated journey?

A once-in-a-lifetime chance

Another nagging question lingers below the surface of these visions: Who gets to participate? After all, someone will have to live in the communities affluent, tech-savvy commuters leave, and not everyone can turn a car into an office.

If white-collar workers can stretch the limits of their productive time to include the commute, some wonder, will they make even bigger leaps ahead in income, wealth and status than janitors, baristas, and construction workers who may not enjoy the same advantage?

Many analysts MarketWatch interviewed disputed that idea. Some non-knowledge workers might reclaim their time on the road in other ways, such as napping or communicating with friends or family members. And as Cummings notes, it’s possible that many communities — not just wealthy ones — could benefit from the technology.

Graphic: Fewer cars, but more people

What is certain, however, is that automated vehicle technology offers fantastic opportunities— and unimaginable disruption — beyond what’s described here. 

An example: More than 9 million Americans currently work in transportation occupations, according to the Labor Department, and automation could be deadly for those careers. But for others, such as an estimated 6 million with physical disabilities who have trouble getting the transportation they need, the technology could be a lifeline.

Naturally, every prediction should be taken with a grain of salt.

And with lessons from the rise of the internet — and the earnest predictions that it would spell the end of dictators, a new era of dominance for small businesses, and seamless globalization — still fresh, a healthy skepticism is warranted. “The future,” Yogi Berra once said, “ain’t what it used to be.”

Still, it’s hard not to get excited about the transition that lies just ahead. Self-driving technology offers a once-in-a-lifetime chance to remake our space, the way we move around it — and how we live in it. 

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