I called the Department of Transportation today to find out more information about the letter they sent. It turns out they are NOT widening the road we live on; they are just resurfacing it and upgrading the pedestrian ramps on the corner. At most they would probably purchase the mow strip, which I would be fine with selling. I've never liked that mow strip anyway. It has caused us nothing but grief in the 14 years we have lived here.
Of course I had mixed feelings about the news. On the one hand, I was relieved that we wouldn't have to find a new house and stress about the moving and the financing and all that. On the other hand, I was kind of bummed because it's exciting to think about finding a new house and moving. I think overall I'm fine with missing out on the excitement right now. We have plenty of other things going on.