As gas prices rise, will real estate values drop?

Not as far as new construction is concerned because of the increased costs associated with transporting materials.

Robert, I think we're in for continued rude awakenings as fuel prices will effect so many commodities.

It could be a very ugly situation, esp. if mortgages get any more difficult to obtain and interest rates creep up. I just keep telling myself "focus on the positive, focus on the positive, focus on the positive." =)

I am wondering whether we will see Malthusian Economics dusted off and some sort of cataclysmic ending taking place. Much of this is self-limiting but when people have had enough, they have had enough. Decoupling the US economy form that of China may have begun but if the container boats stop moving across the ocean, lot of people will be in dire straights.

YEs many business are starting to see the impact many dont want to drive unless a resident close to transportation other out laying areas may have problems

I am lucky I live in British Columbia, we have oceans of Natural Gas, so forget the Smart Car, Hybrid, Diesel, or Hydrogen Fuel Cell...my next car is going to be a Factory Installed Natural Gas vehicle.  You can even get a home filling station and use your pre-existing home Gas Meter.  Factory Natural Gas vehciles are much more cost effective than a Hybrid

Currently nestling between 1/4 and 1/3 the price of Regular Gasoline, Natural Gas is the clear choice around here.

We're in for many changes, I believe, in the economy--with this being election year, the 2007-8 housing crisis and lending in a shambles, we really did not need the oil situation to peak right now!  You're right, who knows how things will change but, irregardless, things ALWAYS change.  We have to be prepared with our 'Plan-B' and be open to keeping our business plan tweaked with the swings in the economy!

Robert:  I do think that homes far away from the city or main business districts will drop in value... rather than continue to be thought of as the "place to move to."  I also think that closer-in neighborhoods... perhaps even ones that have fallen into disrepair and have been abandoned, will be seen in a much different light.  This in the long run will prove very valuable to the cities rather than the suburbs.

I'm looking at it this way. Real estate has always been location, location, location.  Now it's going to be LOCATION!!!!!!! LOCATION!!!!!!! LOCATION!!!!!!! People living in the exurbs will be out of luck.  People living in suburbs with easy access to public transportation and stores will be sitting on a huge pot of land gold.  Although SF homes have taken a slight dip where I am, my guess is that lots of land within 30 minutes of Manhattan by train are not going to stay down for long. Areas like this are a big buying opportunity right now. I'm trying to drive this point home with a sledge hammer to my fence sitters who still have pipe dreams about snaging the perfect place for half the price they  can have it now. That may happen in the exurbs, but in areas close to Manhattan and the business districts of White Plains, Stamford and New Rochelle, that is not happening.  This is a pattern that I'm already seeing.  Although all markets are soft, the areas close to where everyone wants (needs) to be have very sticky prices.  Volume is low, but sellers know they don't have to give it away.

Im not sure gas will effect the real estate market values. It will certainly put a premium on location and rural will be less appealing for some.

I think many folks will spend more time planning and budgeting in the future.  By eliminating unnecessary driving trips and combining multiple trips into one larger or longer trip to the grocery and other places can cut down on our fuel consumption.  The reality of fuel cost and impact it will have on farmers and growing food and delivering it to the market is a concern of mine.   

I'm hoping that they start drilling for oil here and that oil prices will drop.  Otherwilse, you may be right about the impact high oil prices will have.   I guess we'll just have to wait and see...  :)

Robert, good post and some really interesting comments.  It is going to be interesting to see what happens.  I think if you look hard enough, there are pro's and con's to every situation.  This one won't be too much different in the long run.   

At the same time, I'm seriously looking at my driving habits for ways to become more efficient.   

Did you read about the guy who paid $1,100 to fill up his boat? He said it cost him $50 to go up the river to Old Sacramento for lunch, so he doesn't do that anymore. Some boaters are hauling in jugs of gas for their boats because it costs $2 more per gallon in the Marina.

Robert, it's a scary time for all. You have brought up some very good points and I concur.

Gas useage/price is NOT going to be AS important as good schools, well-kept homes and high-speed internet access in rental HOME selection.....most people see these increases as seeasonal, blame it on politics/BUSH, or BIG OIL. 

OUR POSITION as property manager for our client/property owners is to WORK/DRIVE smarter and RENT homes no matter WHERE they are. 

I am not taking remote properties * I'm getting these calls where owners have always rented them themselves in the past, have their own lease for me to use and can't get tenants to call....they blame it on distance from town/UVA/work when it is REALLY no high-speed internet/cel phone service OR lack of proper web marketing.

All I can say is "Alternative Energies" can't come quickly enough for me.

Scary isn't it?  I commute over an hour to my model home and the gas situation is insane.  I am blessed that I found a station to fill up at "only" $3.69/gallon when everyone in Texas is paying $4/gallon.  Probably too good to be true!  If I get stranded, I will call you to come get me! (0;