Friday, March 29, 2013

High Speed Rail's Implications for California Real Estate

Read this NY Times article about California's High Speed Rail.  The following quote I reproduce below highlights a similar theme as my recent PNAS China Bullet Train paper.

National reporting on the new high-speed railroad (HSRR) encapsulates the strange delusions outsiders have of California. HSRR has been hyped as a fight between profligate Liberal Train-Huggers out to save the environment vs. Money-Savvy Conservatives out to save the budget. In reality, in a different political climate, the partisans should be on exact opposite sides because HSRR is NOT about saving the environment nor busting the state budget. HSRR is about the one true obsession of California: Real Estate. It is well known that California has ridiculously high housing prices. What is never mentioned is the real reason for this state of affairs: geography. CA real estate development is not constrained by liberals (lots of them are real estate agents) but by the geographic realities of California. Flat buildable land not in a remote desert away from job centers is at a premium. There is, however, one HUGE reserve of such land: the San Joaquin Valley. The primary result of building HSRR from LA to SFO will be to open that vast reserve to real estate development. The promise of HSRR is not that you can go from LA to SFO in 2 hours and 40 minutes, but that you can live in a reasonably priced house somewhere between the two and get to work in an hour or an hour and one half without fighting traffic. California may have its strange delusions but, as currently framed, the national dialogue about what HSRR means to California is much stranger, much more delusional.