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May 20, 2021

Gas prices make home buyers want to live close to work: study

Hmm. How best to put an original spin on soaring gas prices …

1235157_house_for_sale Rising gas prices are like the two morons from Harold & Kumar Go To White Castle. They’re high – everyone knows they’re high – and you’re sick of hearing about them. You just want them to go away.

And while they may soon (the national Canadian average price has gone down about six cents per litre since the start of May), that doesn’t mean pump reads haven’t gotten so bad they’ve already shaped our consumer behaviour.

According to Coldwell Banker, the high cost of gasoline has changed where home buyers are looking to buy property.

About 75 per cent of realtors said the recent spike in gas price has influenced their clients’ decision on where to live, while 93 per cent suggested that, if gas prices continue to rise, more buyers will be looking to buy homes that allow for a closer commute to work.

Now, in the short-term at least, gas prices aren’t likely to “continue to rise.” We have decades of historical proof that says a) gas prices have only been higher once in history (the summer of 2008), and b) after such inhumane spikes, pump reads almost always simmer down to a less alarming level in the subsequent months.

But forgetting that, there’s at least some chance that this isn’t just a sign of the times – a knee-jerk reaction to higher gas prices that’s likely to cease.

Much as the recession may have changed our consumer behaviours for the better (hey, look, people are paying their credit card bills again), perhaps the 2011 gas price spike will similarly alter our home buying patterns going forward.

According to the Coldwell Banker survey, while many buyers want homes close to work, about 77 per cent of realtors said clients are also much more interested in houses that can accommodate home offices than they were even five years ago. Nearly seven-tenths (68 per cent) said higher gas prices contributed to the increasing work-from-home demand.

More to that, fewer people want to do the old work-in-the-city, commute-from-the-suburbs thing anymore. Fifty-six per cent of realtors said more home buyers are interested in urban living – read: closer to work – than five years earlier.

How have gas prices affected your buying behaviour? Would you ever move, or consider buying a home closer to work, in a bid to save money on gasoline?

By Jason Buckland, MSN Money

*Follow Jason on Twitter here.

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Gordon PowersGordon Powers

A long-time fund company executive, Gordon Powers now heads up the Affinity Group, a financial services consulting firm. Gordon was a personal finance columnist for the Globe & Mail for many years, has taught retirement planning...

Jason BucklandJason Buckland

The modern-day MC Hammer of money, Jason can often be seen spending cash that isn’t his with the efficiency of a Wilt Chamberlain first date. After cutting his teeth as a reporter for the Toronto Sun, he joined the MSN Money team with...