Since 2008, when gas prices reached record highs, CNT’s H+T Affordability Index has highlighted the impacts of gas prices on household transportation costs. The Total Driving Costs tool allows users to slide the gas price up or down and see how volatility in the price at the pump impacts communities differently.
The H+T Affordability Index has long shown that the old “Drive Till You Qualify” real estate mantra fails to capture the higher transportation costs that accompany the lower housing costs as you drive further from the central city and other job centers.
Households who live in places without transit and other transportation options, and with long distances between destinations, generally need to own more vehicles and drive them further distances than households closer in. With the recent spike in gas prices, this has gone from an inconvenience to a crisis for many lower-income and moderate-income households.
Rising Gas Prices
The Housing and Transportation (H+T®) Affordability Index, one of CNT’s best-known tools, can help to quantify the impact of higher gas prices on transportation costs: Total Driving Costs tool allows users to slide the gas price up or down and see how volatility in the price at the pump impacts communities differently.
Total Driving Costs: Harvey, IL
In Harvey, IL, for example, the Regional Moderate household, averaging 2.7 people and earning $49,462 per year, would spend about 23% of their income on housing and 21% on transportation, totaling just under the 45% that H+T considers affordable when combining housing and transportation costs.
While fuel costs are just a small portion of transportation costs, a sudden rise in prices could have significant impact on households without much left after paying the rent or mortgage, car payment, and other regular living expenses. This household in Harvey who previously may have been paying $158 per month to fill up the tank at $2.50/gal, will suddenly need $316 when the price jumps to $5.00/gal.
Meanwhile, households who live in places with greater transit access are much less impacted by fuel price changes. This is further evidence, for anyone who still needs it, that a strong public transit system is fundamental to our society.
Explore the impacts of gas prices on your community at H+T Total Driving Costs