The logical follow-up to my oil freak out rant (below) is "So What's the Impact?" One thing I've definitely noticed in my 7 years selling real estate here is that uncertainty and anxiety is the bane of real estate. People are more comfortable making big decisions when they feel settled, and postpone big decisions when they feel unsettled. If the stock market drops and oil prices and unemployment rise, that in and of itself isn't devastating — if all those numbers settle at new stable levels. (Of course, if those numbers turn out to be $6 gas, 8% unemployment, 10,000 DOW and $2 to buy a Euro, my assertion here may not be that correct, because we'll be in the territory of a new economic reality.) But over the last few years, when there has been significant economic uncertainty or volatility in the equity markets, real estate activity slows until the waves settle.
That being said, waves or no waves, there have been some noticeable shifts in the real estate market here in the last 6 months as we've seen oil and gas prices ratchet up. I'm definitely seeing more interest in smaller houses, and not just because they're less expensive. There more awareness of the energy cost of a house, and larger houses typically consumer more energy. A year ago, buyers seldom asked about the heating costs for a house. Now its a common question.
Now, our most energy efficient houses tend to be those smaller vinyl-sided modular ranches built in the last few years. (The New York building code for energy use is one of the toughest in the nation, and all recently built houses have had to conform to that code.) These may not be the most aesthetically pleasing houses to city second home buyers, but they're more cost-effective to buy and operate than older, more charming farmhouses, cabins and cottages. It will be interesting to see if they gain in popularity. I expect we may see a few courageous trend setters take some of these houses and transform them into something more stylish.
Another factor people are thinking about is ease of access. Some remote or secluded properties with long drives can require the additional height clearance of an SUV, and I've had folks say they don't want anything that requires more clearance than a Suburu or other car-based all wheel drive.
I also think we'll see much more interest in the orientation and siting of a house. Western facing, sunset oriented houses (often in field settings to pick up expansive views) can get awful hot on a late summer afternoon, and are typically the only houses up here that need some air conditioning. A south or north facing house, surrounded by a nice large shade trees seldom needs air conditioning. Porches, overhangs and awnings often provide natural climate control. I expect we'll see a number of articles in the next few months in Dwell, et al, that will focus on lower tech 'natural' climate control, rather than the expensive high tech solutions, like geothermal, that they've been so enamored of.
And finally, over the last few years, more and more second homers up here have been keeping their houses open for the winter and coming up year round. They tend to enjoy the peace and quiet of winter weekends here. But if heating oil prices this coming winter tend to be double what they were this past winter, I expect that some of these year round second homers may decide to shut their houses down from January through March.
Just some thoughts.