[6/27/08 - Updated with a math correction, thanks to reader Roland]
I just read a story in the Boston Globe about how gas prices are affecting how people are thinking about buying homes. Apparently, home buyers are favoring more urban locations with short commutes over the suburbs:
In a survey of its agents by real estate brokerage Coldwell Banker, 81 percent said they are seeing more interest from prospective buyers in urban living because of high gasoline prices. Fifty-four percent said access to public transportation is more important to their clients now.
It goes on to suggest that some otherwise content homeowners are considering moving because of fuel prices. In other words, selling their homes in the suburbs and buying something closer to where they work to save money, or, at least, to put the money toward their house instead of into the gas pump.
The article didn’t mention something that popped into my mind as soon as I heard the terms “house hunting” and “gas” in the same sentence: the price of driving all over Seattle every weekend looking for the right neighborhood. I thought of my own adventures house hunting around Queen Anne, Capitol Hill, Issaquah, the U-District, Shoreline, Ballard, Wallingford, West Seattle, yadda yadda yadda, and so on. That’s a lot of gas.
Let’s do some back-of-the-envelope math. For open houses and neighborhood canvassing, we probably drove about 30 miles on a given weekend, three weekends a month, which puts us at around 90 miles per month. We did this for six months, for a total of 540 miles, which (at 15MPG) translates to 36 gallons of gas. Back then I think gas was a bit more than $2/gal (say $2.25), which means about $81 for my environmentally hostile Ford Expedition (email me if you want to buy it. Really.)
At around $4.50/gal, this same home shopping spree would have cost us about twice as much. Ouch. That’s about $162, and we were web savvy enough to do targeted trips. I don’t even want to think about how much more gas we would have burned if we hadn’t used Redfin and Google Maps to chart our way. My take on the gas price crisis is that it will do two things: drive more people to Redfin and all things web, and reduce the number of home shoppers hitting the streets, including going to open houses.