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The Wall St. Journal sees it...
http://www.wsj.com/article/SB121366811790479767.html
In recent years, a generation of young people, called the millennials, born between the late 1970s and mid-1990s, has combined with baby boomers to rekindle demand for urban living. Today, the subprime-mortgage crisis and $4-a-gallon gasoline are delivering further gut punches by blighting remote subdivisions nationwide and rendering long commutes untenable for middle-class Americans.Just as low interest rates and aggressive mortgage financing accelerated expansion of the suburban fringe to the point of oversupply, "the spike in gasoline prices, layered with demographic changes, may accelerate the trend toward closer-in living," said Arthur C. Nelson, director of Virginia Tech's Metropolitan Institute in Alexandria, Va. "All these things are piling up, and there are fundamental changes occurring in demand for housing in most parts of the country."
The New York Times is covering it too...
http://www.nytimes.com/slideshow/2008/06/24/business/0624-EXURBS_index.html
(Denver) The economics of the American suburban life have come under assault as skyrocketing energy prices inflate the cost of reaching, heating and cooling homes on the outer edges of metropolitan areas....
Pedestrians walk between condos, lofts and businesses across bridges in what was once a railyard. A $6.1 billion commuter rail system has been going in over the last four years, drawing people downtown without cars, while crystallizing swift sales of densely clustered condos near stations.
Even housing lenders are starting to see the trends...
http://www2.standardandpoors.com/spf/pdf/index/052708_Housing_bubbles_collapse.pdf
There is also some evidence that household preferences for larger homes may be shifting. In part, this is simply because of sharp increases in commuting costs. During the early years of the housing bubble (2003-2004), the average price of gasoline was US$ 1.70/gallon. Since then, gasoline prices have more than doubled (US$ 3.65/gallon in May 2008), which means that the out-of-pocket costs of commuting for auto drivers have increased by more than 100%. Higher energy prices have also increased heating and cooling expenses, making the monthly costs of owning larger homes jump relative to those for smaller homes.
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