09/21/2008 05:12 am ET Updated May 25, 2011

City Mouse, Country Mouse: Who Spends More?

For decades, people have chosen life in the 'burbs because of the lower cost of housing, the extra space, and the family-friendly atmosphere. Gas prices, however, could change everything about suburban life—and a great tool that analyzes the true cost of suburban living can show us how.

According to the rule of thumb, when budgeting, most families should earmark a third of their income for housing but try not to spend more than that—leading them to seek housing farther and farther away from city centers, encouraging sprawl. However, the farther you are from a city center, the more likely you are to have no other options than becoming a two-car household, at the mercy of gas prices in your town.

The Center for Neighborhood Technology, Brookings Institution, and Center for Transit-Oriented Development have come up with an affordability index that maps the true cost of suburban life vs. urban life by combining census data about income, housing, and transportation. The index found that city living, which many people consider to be too expensive, can actually be more economical than life in the suburbs.

Said Maria Stamas of the Rocky Mountain Institute: "Among the findings, people who live close to transit, jobs, schools, and retail—typically in cities and inner-ring suburbs—spend up to $2,100 less per annum on gasoline than residents of outer-ring suburbs."

In a mini-case study, I compared my neighborhood in my hometown of Pittsburgh, where seemingly every family has at least two cars, to my pedestrian-friendly neighborhood in Washington. If I were to move back, according to the map, my average monthly rent would be several hundred dollars less, but my combined transportation costs with housing would exceed 55 percent of my income. In Washington, rent may be high, but the average person in my neighborhood here spends only up to 37 percent of his or her income on housing and transportation combined, while enjoying walkable neighborhoods and an abundance of public transportation. You can see the distribution in this Center for Neighborhood Technology map of Washington, D.C. here, which shows housing and transportation costs as percentage of income for renters.

If you're searching for a house, the tool could be a good way for you to find the ideal combination of affordability and convenience. Obviously, city life can have its drawbacks—the schools may not be as good, and there is less space, more noise, and more crime. At the same time, a revitalized city is extremely green: It fosters connected neighbors, walking and biking encourage healthier families, and citizens aren't prisoners to the rising price of fuel. How does your neighborhood rate?

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