Posted on 07/16/2008 5:43:59 AM PDT by Diana in Wisconsin
Debbie Kelly and her husband, Tom, have been living the dream for years.
They've got a cozy home nestled in the Wyoming Valley, the bucolic Iowa County setting where architect Frank Lloyd Wright drew his inspiration.
Deer graze in the yard. Orioles flock to the bird feeder. When nights are clear, the Milky Way lights the sky.
It's a little slice of heaven -- save for the 45-mile commute to work.
It wasn't a big financial drain driving into Madison, even as gasoline passed $2 a gallon in 2004 or $3 last summer. But for Debbie Kelly, $4 fuel has been the tipping point.
Now, instead of driving all the way to her nursing job at the Dean Clinic on Fish Hatchery Road, Kelly will often park in Verona and ride her bicycle the rest of the way. One night a week, she camps in the back of her pickup truck at Lake Farm County Park, south of the Beltline on the shores of Lake Waubesa.
"They've got the hottest showers," said Kelly, 54, a mother of three.
Kelly admits she's thought about moving closer to the city. The time spent driving and the rising costs are beginning to wear. But she said her husband isn't budging.
"Tom will probably go with the property," she said. "I don't think he'll ever leave the valley."
Whether high fuel prices are going to affect where people in Wisconsin live remains to be seen. It's not that simple to just pick up and move, especially for those who already own a home.
Still, it's a question crossing the minds of many who chose to buy a home miles from their place of employment or school.
"It really hit me when it cost nearly $100 to fill up the truck last week," said Rich Eggleston, who lives in Fitchburg and commutes to his job downtown at the Alliance of Cities.
And there are early indications that life in the suburbs is starting to look less attractive to home buyers.
Consider the median price of homes sold in McFarland is down nearly 19 percent from a year ago, falling from $258,000 to $210,000, according to the latest figures from DaneCountyMarket.com.
In Mount Horeb, prices are down 14 percent. In Fitchburg, they're off 8 percent. In the New Glarus/Belleville/Monticello market along the Dane-Green County border, prices are down nearly 10 percent.
While real estate insiders say it's dangerous to draw conclusion from just a few months of data -- Verona, Waunakee and Sauk City, for example, have all seen prices climb in 2008 -- there seems a growing realization that gasoline prices are not going down again.
That's left some observers wondering if the drivable suburb -- the model for virtually all post-World War II development in Wisconsin and the U.S. -- has run its course.
"I think we're looking at a tremendous societal shift," said Steve Hiniker, executive director of 1,000 Friends of Wisconsin, a statewide group that advocates for better land use. "Urban areas such as Madison and Milwaukee will continue to fill in and modern transit will soon be a part of the urban setting. Suburbs will continue to lose value as gas prices hit the stratosphere."
Indeed, the future of the suburbs in the face of rising energy costs has sparked a flurry of national reports in the past months. Many have come from groups that would like nothing better than to see an end to sprawl and a reinvestment in mass transit and the urban core.
One study from Chicago-based CEOs for Cities argues that soaring gasoline prices are what really popped the nation's housing market bubble.
"The popular narrative on the collapse of housing prices has only blamed exotic lending practices," said the group's economist Joseph Cortright. "But the much more important story is about how higher gas prices have re-drawn the map of urban real estate values."
In another report, Arthur Nelson of Virginia Tech predicts the nation is facing a surplus of 22 million large lot homes (houses built on 1/6 an acre of more) by 2025. That represents roughly 40 percent of the "McMansions" in existence today, places like Bergamont, Bishop's Bay and Hawk's Landing in Dane County.
And long-time sprawl critics like James Howard Kunstler have cheered the higher fuel prices as finally bringing an end to decades of suburban madness. He said trying to find solutions to keep the "Happy Motoring" utopia running is naive.
"The truth is that no combination of solar, wind and nuclear power, ethanol, biodiesel, tar sands and used french-fry oil will allow us to power Wal-Mart, Disney World and the Interstate highway system -- or even a fraction of these things -- in the future," Kunstler said. "We have to make other arrangements."
Closer to home, not everyone shares the same doom-and-gloom scenario.
Madison Mayor Dave Cieslewicz said fuel prices haven't reached the point where Americans have been forced to make fundamental changes. Rather, he sees a more gradual shift to a balanced mix of transit, compact development, walkable communities -- and single-passenger vehicles.
"I just got back from Europe and people still love to drive but they have other options," he said. "Unfortunately we've created a physical environment in this country that makes us slaves to our cars."
Cieslewicz said those who oppose mass transit or improved rail service often argue that environmentalists want to take away the freedom to drive.
"People on the other side of this issue use scare tactics and say everyone will be forced to give up their cars," he said. "But there is actually more freedom in having the option to bike or walk somewhere without fear of getting killed."
Troy Thiel, who moved to Madison in 2003 from the Chicago area and narrowly lost a 2007 bid for a seat on the City Council, predicts the suburban housing market will weather the storm. He notes that many of the area's largest employment centers are no longer located downtown -- including Epic Systems in Verona, American Family on the far east side and Discovery Springs in Middleton.
A sales agent with First Weber West Towne, Thiel also questions whether fuel prices are having much impact at all on an already depressed real estate market. He notes that sales of homes and condos within five miles of the State Capitol were down 30 percent for the first six months of 2008 versus a 25 percent sales decline overall.
"People are choosing more efficient personal autos and will locate closer to their jobs, many of which are already in the 'burbs," said Thiel. "Rich folk are putting their SUVs in the garage. That way $4 gas looks like $3 gas and they're just fine with that."
Needless to say, those who can afford it don't feel the fuel pinch as acutely.
But rising oil prices are costing everyone plenty. The average American household will spend over $3,200 to fuel their vehicles this year, according to the Bureau of Labor Statistics, more than twice the cost of just five years ago.
In Dane County, drivers are now spending a combined $428 million more on gasoline than in 2004, according to professor Andy Lewis, community development specialist for University of Wisconsin Extension. That's money that could have gone to a lot of other uses, whether affordable housing or commuter rail.
Lewis noted that in 2006, when gasoline averaged $3 a gallon, households with incomes under $14,999 were already spending eight percent of their income on fuel versus three percent for households with incomes over $100,000.
"As expected, the lower income households are feeling the pinch more then wealthy households," said Lewis.
On the other hand, Alan Harvey, chairman of the town of Windsor, said Dane County enjoys the advantage of having a diverse economy -- a mix of both urban, rural and suburban development.
"Clearly, all of society is going to be looking at a period of adjustment," he said. "But I think we're pretty well-positioned since economic activity is spread throughout the county."
Harvey said the real impact is being felt in communities outside Dane County like Fall River or Pardeeville, where people have purchased homes because they got a lot more square footage for their dollar.
"Those advantages start to disappear when commuting costs get too high," said Harvey, who is skeptical about the ability of mass transit to solve the problem.
Madison Ald. Robbie Webber, who defeated Thiel in the District 5 council race, has championed higher density urban development and mass transit as the long-term solution. Despite the growth in the suburbs, she said Madison remains the engine that drives the area economy with its downtown and UW campus.
"Even lunch is easier to get to without a car in a dense area than in a suburban business park," she said.
Webber said the concern isn't so much with Middleton or Verona, two places where real estate values have been holding.
"What about Mount Horeb, Dodgeville, Lake Mills, Edgerton, Portage?" she said. "Those long commutes, with no hope of transit, are going to be pretty painful."
To that end, commercial real estate developer Terrence Wall says he realized several years ago that rising gasoline prices were going to dramatically impact Dane County. For that reason, he's pursuing mixed-use projects combining office, residential and retail at Tribeca Village in Middleton and the West End in Verona.
"I've been warning people for the last three years that demand for oil in China was going to send prices skyrocketing," said Wall, president of T. Wall Properties.
Dan Miller, a Realtor with Keller Williams who maintains the DaneCountyMarket.com Web site with colleague Shawn Kriewaldt, cautioned against drawing too many conclusions about the long-term impact of gasoline prices on the local housing market.
"For example, I just helped somebody sell a house in Madison and buy one in Mount Horeb because they work at Epic and wanted to be closer to their job," he said.
Miller said a few more months of data may help paint a clearer picture.
"I think we're on the early part of the curve right now," he said. "Most folks spend several months looking for a home before they make an offer, and once an offer is accepted, it can be another 1 to 3 months until the closing. Given the lag between the decision to buy and the actual purchase, my hunch is the data will become more telling later this fall and winter."
At this point, most commuters are just biting the bullet, trying to combine trips or share rides when possible.
Nicole Weisenberger, who drives 100 miles round-trip from Madison to her job as an occupational therapist in Beloit, has found a few ways to offset the high gas prices. One is purchasing a Pontiac Vibe, which gets over 30 mpg on the highway. The other is cutting back on doggy day care from three days to one day a week.
"To be honest with you, I think the dog has been suffering more than I have," she said.
“See? There’s always a Silver Lining.”
Especially for all of the servicemembers working at the Pentagon and various DC locations who could not afford the exhorbitant housing prices inside the Beltway and had to more 30-50 miles away in VA and MD and now have to pay $4+/gallon of gas.
I guess they too should “Fall in line, now! *SMIRK*”
Sheesh.
No, in fact the Democrats are pandering on this just like the Republicans. Any politician who says they can do something about gas prices is lying. Any big government program to gain “energy independence” is a joke.
High gas prices are here to stay, and drilling won’t change that. The upside is that the high prices will cause the market to self-correct to something more efficient long before the government figures it out. I can only hope they stay preoccupied with arguing about drilling so they stay out of the way.
Guess you've never heard of the City of Chicago or of Cook County and the Board that runs it. Go ahead, read about it all in the Chicago Tribune or Chicago Sun-Times, the links can be found on Drudge. But be advised, it may affect that alternate universe, aka 'Happy Land', you apparently live in.
ps: But you better hurry while they're still available in English.
No, but you ARE an eco-weenie. Today's "energy crisis" is the end result of years of "eco-weenie" policies, preventing oil drilling, nuclear power plants, building refineries, and on an d on and on. ANY new source of energy (even solar and wind power) end up getting "bashed" by the eco-nutcase types (see Ted Kennedy's opposition to offshore wind power farms).
Sorry, but "inherently liberal" and "might not be so liberal" is too much of a risk to take in moving back to them.
I agree with you to a point. I think smaller cities are the way to go. The Twin Cities are just like that; it’s not like New York or Los Angeles where you’re just lost in a huge mass of people. The great thing is, with modern technology, you can put a city just about anywhere. About four hours west of here, the Sioux Falls area has seen huge growth lately. So, we could see a country of smaller cities, which would probably be the ideal.
Why not spend a little more money on something you can keep and repair when necessary, instead of throwing them away every year? Seems like a huge waste of resources.
Otherwise known as 'the suburbs'.
Well as long as we got THAT all straightened out. :)
That doesn’t mean I trust them to do it, but in theory taxes should go down. As a libertarian, I of course think that’s a good thing.
I mean the same level of service per person. However, the overhead costs of running fire, police, etc. remain about the same, so it should become cheaper per person.
The article stated that the woman in question is a nurse. There are nursing jobs everywhere, from small town hospitals to doc in a box clinics, to schools. She could take a lesser paying position much closer to home and the cost savings in commuting more than makes up for it.
Some circumstances are hard to predict. Figuring out that gas wasn’t going to stay at a dollar a gallon was a no brainer. Anybody who was alive in the 70’s knows how easily energy prices can change and how that can effect your lifestyle. I myself was a baby then, which is why I’m flabbergasted that people older than me didn’t realize this could happen.
You also could move out California. Not all cities are like Los Angeles.
Except no parent who cares about education would put their children in the failing inner city schools.
Therefore, the flight to the suburbs. It’s not only about McMansions. . .
"in theory taxes should go down"
"the overhead costs of running fire, police, etc. remain about the same, so it should become cheaper per person."
Should?? You seem to have a lot of faith in the benevolence and efficiency of government.
Chicago is but one city, and a huge one at that. It’s much holder to hold local government accountable at that size; it’s like state government. I favor smaller cities. That’s why I like Minneapolis and St. Paul.
>This is exactly why I have always lived in the city.<
Well, that’s your choice. The city in which I was born is now totally controlled by Democrats. I’m in an outlying county (12 miles or so from town, so I’m not that far in the sticks) and my family more than saves enough in taxes to make up for increased energy costs.
If you want to live in a Democrat hellhole, go for it. Mine is to live where I’m governed by like-minded people.
You don’t think it has anything to do the rapid industrialization of the third world? Wake up. Drilling won’t do anything. High prices are here to stay, so let’s allow the free market to guide us toward the most efficient alternative.
subway to work, rent my apt so heating oil is not a concern. heat and hot water are covered in rent.
i keep a motorcycle for the warmer months. easy parking and great gas mileage. if and when i move out, it will be close to public transportation so i don't have to rely on a car.
i am not going to take a chance that gas prices will be lower in 10 years.
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