Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I am wondering what all of you think about the effect of fuel prices on real estate. If fuel prices continue to rise do you think this will put a major halt to new home construction? Do you think that fewer new homes will increase demand for existing homes, and therefore prices will begin to rise? I think part of the housing mess had to do will all of the new developments popping up all over the place. What are your thoughts?
Rising fuel prices will increase the cost of new construction which could help move some of the resales.
I don't think this would cause a rise in value but maybe a few years down the road when inventory is down it might.
I am wondering what all of you think about the effect of fuel prices on real estate..What are your thoughts?
Thanks.
The profusion of houses that popped up like spring flowers all over our country which where typically built far out from shopping/recreation/medical/employer locations where land was cheaper for developers are not the "away from the maddening crowd" deal they were before cheap gasoline/diesel. Those who bought into walking communities/neighborhoods with easy access to public transportation/shopping/recreation/medical/employer locations nearby are looking pretty wise in these $4-5 dollar a gallon times. The trend of young people relocating to urban areas is no anomaly, they have already learned a valuable lesson from the mistakes of their seniors.
Last edited by Ria Rhodes; 07-13-2008 at 08:47 AM..
I am wondering what all of you think about the effect of fuel prices on real estate. If fuel prices continue to rise do you think this will put a major halt to new home construction? Do you think that fewer new homes will increase demand for existing homes, and therefore prices will begin to rise? I think part of the housing mess had to do will all of the new developments popping up all over the place. What are your thoughts?
Thanks.
Out here, there has already been a major halt of new construction. Inventories are still high and builders have slowed production as a result. I think gas prices have less to do with new construction than current inventories. Builders operate on supply and demand. If the demand is there with higher gas prices, the final resale price will just be reflective of that.
We have UGB's (Urban growth boundaries) out here, so we don't really have sprawl like other areas do.
High fuel and other prices have lead to people not taking on more debt. It also will mean that the average person will be looking for a lower cost smaller home and if you look at the national buiders they are responding.When buiders reduce the price on inventory it means they don't think the value will hod relative to cash or sale quickly enough.Home sales and vehcile sales have alot in common and we know what is sellign i vehciles very easily.Builders operate on slaes and they like to have a inventroy to compete aginst existing home sales but in these times they need the cash to stay afloat ;so they drop inventories and that hurts existing sales.
Fuel is certainly part of the problem. Not the entire problem of course.
Developments around here haven't ground to a halt but those being worked on are those that were in progress already. New plans? We haven't seen one in quite a while. Land sales are down to almost nothing and there are some exceptional values available at prices unheard of two years ago. But nothing, not even a trailer park is in the works.
I live in a very small town and I have seen business slow down a lot. There hasn't been any new subdivisions going in here. Like Bazzwell says, those that are being worked on were already in progress. The builders are in so far it wouldn't pay them to stop now. It is only 20 miles to the nearest big city (Murfreesboro TN, population around 500,000). With fuel prices so high everyone wants to live as close to work as possible. Guess these cities will get even bigger!
Mc Mansions and trophey homes represent about a third-half the inventory in my area. They are indeed selling. Most folk barely break even on these resales, even in the best of times because they compete with new builds. The cost to heat and cool these places does not seem to phase the buyers, for now......
I see buyers looking for homes closer to town and work. The cost of gas has made living in the exurbs and suburbs less desirable.
Sandy
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
