Not so long ago the thinking was “drive ‘till you qualify†– but it’s a brave new world, with a barrel of oil costing $118.10 (as of this writing) and gallon of gas reaching up for the $4.00 per gallon threshold, that thinking just doesn’t work like it used to. Home owners and developers are having second thoughts about that nice little three-bedroom split-level gleaming in the distant suburban sun – or put another way, that house miles from anywhere you need to be (other than home) that’s worth less than you paid for it.
Not so long ago the thinking was “drive ‘till you qualify†– but it’s a brave new world, with a barrel of oil costing $118.10 (as of this writing) and gallon of gas reaching up for the $4.00 per gallon threshold, that thinking just doesn’t work like it used to. Home owners and developers are having second thoughts about that nice little three-bedroom split-level gleaming in the distant suburban sun – or put another way, that house miles from anywhere you need to be (other than home) that’s worth less than you paid for it.
A recent report on National Public Radio’s Morning Editiontalks of tumbling home prices in a “slowed†economy (just don’t call it a recession), and to a phenomenon in the housing market that is best summed up in three words:
- Location
- Location
- Location
There’s a new metric in town when it comes to buying a home, and it’s one we’re already familiar with: miles per gallon.
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Driving Yourself Crazy
Certain parts of metropolitan Washington D.C. enjoy the dubious distinction of some of the longest commute times in the nation along with a nearly 50% foreclosure rate. But drive the 40 miles to the city and competition in the housing market is fierce, with people wondering what all this talk is of falling real estate values. In fact, housing prices are up 3.5% within the city limits of Washington.
Go to Los Angeles, San Francisco, New York, Boston, Miami, or San Diego (for starters) and you’ll find the same thing, according to Jonathan Hill of Metropolitan Regional Information Systems. In a nutshell, the longer the commute the steeper the fall in real estate value. People are realizing that the savings found in that distant tract house is eaten up in the drive to work – day after day after day. It isn’t just a money issue either, but a quality of life concern as well. After all, what’s the value of an hour of your time?
Of course, many of the developments stretching out toward what was once forest and farmland were “just bad ideas to begin with†says David Stiff, chief economist for the Case-Shiller Home Price Index. Thus the trend among smarter developers is increasingly toward walkable neighborhoods near work or public transit systems.
And there’s an even bigger picture to look at: climate change.
In Growing Cooler, a book published by the Urban Land Institute, the authors show how sustainable urban development not dependent on cars is vital in mitigating climate change. It’s a three-legged stool forming the basis for curbing carbon emissions – cleaner fuels, improved vehicle efficiency, and reduced driving – and the best way to reduce car travel is to build places where people can live, work, and accomplish more while driving less.
So what will happen when the economy digs out of the current reces… er – slowdown? Will we all jump back in our cars, filled with cheap gas, forget all we’ve learned about sustainable (and livable) development in a mad dash back to our house in the distant ‘burbs?
Time will tell, but my bet is on a smarter way to design our communities – a new American Dream.
