Gas Prices: New Factor In Realty Market?

<p lang="en-US">May 11--For those who have watched development march to the edge for 60 years, it's a case of thinking the unthinkable.</p> <p>But now for maybe the first time since World War II, some planners and a few members of the development community are starting to question whether skyrocketing gas prices will discourage buyers from choosing homes on Tucson's periphery.</p> <p>The questions came up when more than 200 people recently rode the bus for many miles to tour the first leg of what many observers have seen as an inevitable corridor of unbroken development from Sahuarita to the Mexican border.</p> <p>Billed as "The Wild Ride" and sponsored by the business-led Metropolitan Pima Alliance, the tour whizzed through 28 development sites, including 23 subdivisions offering close to 30,000 existing and planned homes.</p> <p>With some exceptions, the tour offered a typical slice of suburbia, with bright red or blue flags waving at many of the entrances and red and grayish tile roofs dominating many of the houses.</p> <p>There was more than an occasional nod to the idea of sustainability, with several developers pointing with pride to set-asides of open space or to plans for stores very close to subdivisions. But in the end, will people drive to work from these homes, costing $150,000 to a half-million dollars, in an era of $3.35- to $3.50-per-gallon gasoline?</p> <p>That's never been a question before, because the allure of cheap land, lower-priced housing, less crowding, nearness to open spaces and larger lots has outweighed the cost of commuting into the urban core.</p> <p>Several planners on the tour -- riders were split about 55-45 or 60-40 between business and government officials -- said they believe today's skyrocketing gasoline prices could or will discourage home buyers in such subdivisions as Rancho Sahuarita, Canoa Ranch, Las Mesas, Madera Highlands, Quail Creek and Rancho Abrego.</p> <p>"I think gas prices have already affected the sales of houses," said John Neunuebel, Sahuarita's planning director, although he added that even in today's growth slowdown, builders still took out 60 single-family home permits in the growing town last month.</p> <p>The tour's lead organizer agreed that gas prices probably are affecting home-buying decisions, although alliance Executive Director Ramon Gaanderse quickly added, "But there's a lot more than gas prices to affect a decision whether to buy farther out."</p> <p>Although areas drawing middle-class commuters could suffer from high gas prices, areas such as Green Valley that draw retirees, or other high-end subdivisions probably will fare better, observers said. Some developers could offer home buyers incentives to keep buying on the edge, Gaanderse said.</p> <p>"If someone drops a house by $20,000 over 30 years and if gas prices go up a buck every year, do they save more in house or gas?" he said.</p> <p>Gasoline is a big factor for Sahuarita-area property owner Elizabeth Nichols, her ex-husband and son. She owns 1 acre, and George Nichols owns 2 acres.</p> <p>George Nichols and their son want to move from there because of gas prices, Elizabeth Nichols said. Elizabeth, who lives in Tucson, drives to that area half as often as she used to because of gas costs, she said.</p> <p>"Gas is a wonderful thing. It gives you an opportunity to go spend your money," said George, a cabdriver who has grown weary after four years of commutes from his house in unincorporated Pima County.</p> <p>Todd Bullington, a Sahuarita resident and city of Tucson employee, and his wife spend $60 to $75 weekly to fill their car and Jeep with gasoline for 17-mile work commutes, compared with $40 to $45 a year or so ago.</p> <p>They bought a $165,000 home in the Rancho Sahuarita development in 2004, when it cost $20,000 more to buy in Tucson.</p> <p>But although Bullington said he would have had second thoughts about buying in Sahuarita if he had known gas prices would jump, he doubts that would have changed his mind. The couple probably wouldn't move back to Tucson unless gas hit $5 a gallon, he said.</p> <p>"It got to be a better option. I think it's safer," said Bullington, a Department of Neighborhood Resources management coordinator. "It's more family-friendly out there."</p> <p>John Strobeck, a veteran Tucson housing consultant, said he doesn't expect a big change because homes on the edge are cheaper than in the city.</p> <p>"It will still be, 'Drive till you qualify,' " said Strobeck, repeating the oft-heard mantra of those who buy on the edge because that's what they can afford.</p> <p>A key for the suburbs' success will be their ability to draw jobs to reduce commuting times, said Carla Blackwell, Pima County's deputy development services director.</p> <p>Suburban areas such as Sahuarita have not done well at that, Neunuebel said. Sahuarita has little land zoned for large-scale employment.</p> <p>The town is trying to change that by planning to annex nearly 15,000 acres on its east and west sides. Today, Realtor Pat Arndt said she already is having trouble selling houses and land in the area from Green Valley to Tubac because of gas prices.</p> <p>"They come if I drive. They won't drive out and meet me out here," said Arndt, a former Green Valley Association of Realtors president who has sold real estate in that area for 12 years.</p> <p>"People used to say, 'I want to be far from everything. That's great.' Now they say, 'I don't want to be away.' "</p> <p>Kelly Turner, who with her husband lives on more than 5 acres in the Elephant Head area south of Green Valley, said she has no plans to leave, even though she and her husband pay $400 to $500 weekly to commute to Tucson.</p> <p>"But is it going to put us in a bind? Absolutely," said Turner, who added that she would definitely have thought twice about moving there six years ago if the gas prices had been this high at the time.</p> <p>"My children are safe here. We have animals. There are no homeowners associations telling you what you can't do.</p> <p>"There are a lot of things we can't do -- put a lot of food on the table or take vacations. We struggle. But we've got to look at what's best for the children."</p> <p>Gasoline costs</p> <p>On average, it's about $3.41 a gallon in Tucson and $3.71 nationally -- an increase of 43 cents locally and 65 cents nationally from a year ago.</p> <p>Source: tucsongasprices.com</p> <p>--Contact reporter Tony Davis at 806-7746 or [email protected].</p>