Urban real estate markets like San Francisco which feature short commutes fare better than those suburban neighborhoods where homeowners drive significant distances to work.  It seems that the longer the commute, the greater the drop in existing home prices. Investors who believe the cost of gas will continue to rise may want to focus on neighborhoods close to the City’s core– or explore areas well-served by public transit in and out of the City (think BART and CalTrain).

With gas prices skyrocketing, more buyers are taking driving distance and the time they spent commuting into consideration when they look for a home.  Maybe this is why the new construction in San Francisco continues unabated. Our new housing is also meeting demand from the growing market of empty-nesters and younger singles.  With the percentage of couples with children declining, the trend toward suburban living is expected by some to continue to moderate even after the housing market recovers.

I also see a correlation between close-in locations and higher rents– highrise buildings within walking distance of the Financial District (like 199 Montgomery, 246 2nd and The Metropolitan at 351-355 1st) command some of the highest rents per square foot in the City.

In the meantime, those who decided to “drive until they could buy” and purchased in places like Antioch and Brentwood are suffering a double-whammny with an expensive daily commute on top of their declining home values.

You can hear more on this story at NPR

This entry was posted on Sunday, May 4th, 2008 at 5:12 pm and is filed under Miscellaneous. You can follow any responses to this entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

Posted in Miscellaneous  

Leave a Reply

Name

Mail (will not be published)

Website