Working for Lunch

The kids had to shovel for Tom+Chee for lunch: 

Location Efficiency Study

This research analyzed a sample of 40,000 mortgages and found the higher the rate of vehicle ownership, the greater the probability of mortgage default. The authors conclude, "location efficiency matters."

Abstract:

Using a sample of over 40,000 mortgages in Chicago, Jacksonville, and San Francisco, we model the probability of mortgage default based on differences in location efficiency. We used two proxy variables for location efficiency: 1) vehicles per household scaled by income and 2) Walk Score. We find that default probability increases with the number of vehicles owned after controlling for income. Further, we find that default probability decreases with higher Walk Scores in high income areas but increases with higher Walk Scores in low income areas. These results suggest that some degree of greater mortgage underwriting flexibility could be provided to assist households with the purchase of location efficient homes, without increasing mortgage default. They also support the notion that government policies around land use, zoning, infrastructure, and transportation could have significant impacts on
mortgage default rates.

Excerpts from the Conclusion:

Our findings indicate that location efficiency matters. Taken together, our results have significant policy implications with respect to lending practices, land use, and transportation planning.

We test our hypotheses regarding vehicle ownership and mortgage default and find that the probability of default does increase with vehicle ownership. Moreover, the impact of location efficiency (as measured by income-normalized vehicle ownership) on default is nontrivial. ... The results strongly suggest that researchers developing and refining automated mortgage underwriting models should seek to test the impact of location efficiency
variables within their models.

It is interesting to note that there is an additional possible explanation for why mortgages for location-efficient homes perform better, beyond the household budgetary savings of lower vehicle ownership. This explanation is that location efficient homes might hold their value better than other homes, and therefore better enable borrowers to avoid foreclosure through alternative measures (such as selling or refinancing the home) if they fall behind on payments or need to manage payment shock from an adjustable rate mortgage.

... our results provide support for policies supporting smart growth development and urban revitalization. That is, designing neighborhoods in such a way that reduces transportation needs is beneficial to borrowers as well as the environment.

Location Efficiency and Mortgage Default (PDF File)
Authors: Stephanie Y. Rauterkus, Grant I. Thrall, and Eric Hangen
Journal of Sustainable Real Estate Vol. 2, No. 1, 2010

Metrodome Collapse Video

I'm Back But Rushed

We just finished one of those downtowner weekends in which we tramped from event to event, laughing and playing in the snow along the way. I met many new people, mostly for just a few moments, but also visited longer with some other dads too:

For example, on Saturday, we accidentally happened upon an advent celebration at Nast Trinity UMC, which is a church that for some reason, I rarely get inside of. The kids met a Santa there, and had pizza and sang carols. As we were leaving, we saw dozens of Santas on Vine Street.

Later that day we saw the Queen City Concert Band perform a free Christmas concert at Memorial Hall.

My wife went to the new shoe repair store on Vine, and the owner said he is buying Al Rohs' key making machine, so that he can continue offering that service to the neighborhood.

Sunday at noon, we were at Just Crepes. My son wolfed down his food and walked out the door. A woman nearby, dressed in Bengal gear, worried that I would lose my son, came over and told me that my son was outside. I assured her that he was fine, and we talked for a bit about their visit to downtown and how they lost their son once at the State Fair years ago.

While watching kids skate at Fountain Square, I met the guy who started Tom + Chee, and he said he is setup to start making mac and cheese and meatloaf on his refurbished stove next week. He has a great entrepreneurial spirit, standing in a freezing tent all day selling $2 hot cocoas and $3 tomato soups (which are excellent).

Sunday just kept getting colder and colder, and it seemed like a blizzard as we left for home. The kids were excited thinking that maybe school would be cancelled. No such luck.

Photos from cell phone this weekend:

Out of Mulberry Street, Jacob Riis book seen at library:
 

Puppet show at Nast Trinity UMC
 

Superheroes mural
 

Parvis Alley
 

New parking lot (blah) at 1420 Republic, behind burned Smitty's
 

Superheroes playground just refurbished, 1414-1416 Republic Street:
 

gas valves found by son in blg being rehabbed:
 

QCCB at Memorial Hall
 

Recital at Watson Hall, CCM:
 

skating