New research from the PEW Charitable Trust shows that infill development saves taxpayers money, especially compared to development on the outlying stretches of a city.
Researchers found that new housing built in areas near shops, jobs, and transit saves money on infrastructure and creates more tax revenue. On average, in North Carolina, they found savings of $12,000 per home in infrastructure costs. Homes also generated $2,000 more per acre in tax revenue.
The difference is even more stark in other states, which tend to build denser housing in urban areas. Minnesota saves more than $35,000 on infrastructure and gets more than $12,000 in tax revenue, for example. In North Carolina, developers often are still building single-family or low-density housing in metro areas, while other states tend to build more dense apartments, townhouses, and four-plexes in cities.
Developers in North Carolina often build at the periphery of cities because the land is less expensive. But that calculus can shift by staying in the city, said PEW Researcher Seva Rodnyansky.
"It's true that land does often cost less in the countryside than in town, but it, you know, you are getting the savings on that additional infrastructure, the piping and roads," he said.
Those savings are mirrored by a higher tax base per acre, Rodnyansky added. "You are widening the tax base because more people are moving in into kind of into fewer resources," because there are more people on the same amount of land.
It means that the time it takes for a new unit of housing to pay back the cost of its own infrastructure in taxes is significantly shorter: On the fringes, it takes 13 years for a house to pay back the cost of its development. Near transit and infrastructure, it takes an average of nine years.
"I think that's really important for local government," he said.
He suggested local leaders can encourage infill development with zoning and regulatory reforms "to make it easier to actually build things like apartment buildings, or fourplexes in already existing areas.”
Residents often are concerned about development within existing cities because of traffic and infrastructure needs. But Rodnyansky said that style of development can actually prevent more cars from being on the road.
"Developing in already existing areas, especially ones near jobs and stores and transit, means that people actually don't need to use their cars as many times per day, or per week," he explained. "So that has actually helped reduce traffic."
Building more density in the city, instead of on undeveloped land where sewer and roadways need to be built, gives cities better bang for their buck. The full findings can be read here.
