Land Values

I know this is my second post in about as many days but I saw something that I felt like posting about and getting people’s opinions about.

I was watching CBC Country Canada on Sunday morning and the episode was about the rising cost of land in Nova Scotia due to foreign purchase and speculation. Although I have hinted at my displeasure with this phenomena in the past, the Country Canada episode livened me to some issues I hadn’t thought about.

Originally I felt this speculation and increase in land value was negative because it prevented Maritimers from purchasing land in their home provinces eventually leading to large tracks of land being owned by non-Maritimers. But, the CBC Country Canada episode awakened me to the fact that this problem is actually leading to people loosing their land. Even people who have lived on that land for centuries. How is this happening you might ask? Well, it’s a question of property taxes. Property taxes are tied to the assessed market value of the land and property(legally all property affixed to the land is actually just land but that is a different post). So, as foreign purchase and speculation increases property values, so do the property taxes owed by those already living on that land.

One fellow in the episode owned a fairly substantive lot of land which was worth 88,000$ something like 10-15 years ago. Now it’s worth 225,000$ and he cannot afford the property taxes. To help pay the increased taxes he has begun to parcel out his land and sell it off in pieces and rent summer cottages. The interviewer asked him something to the effect that: “Most people would say you should be happy, you once owned something worth 88,000$ and now its worth 225,000$, that’s a pretty significant increase. How would you respond to that?”

The guy who owned the land responded with an incredulous look on his face that “that’s not the idea behind all this. Its not about the money, its about being able to share the land with my children.” But unfortunately, as the episode suggested many people won’t be able to bequeath the land to their children because it is likely that their children won’t be able to afford the property taxes.

A second issue the episode pointed to was that these ‘foreign’ purchasers only spend a few months a year at their summer homes which means that a) they are purchasing a lot of the good land and driving up property values which drives out local families and young people and b) are not contributing in any significant way to the local economy or community. They drop in for a few months, spend a little money on food and groceries and then take off. They do not participate in the local life of the community, some communities which have stood for 200 years are being radically changed by this change in property ownership.

What struck me the most about the episode and this problem was that we were seeing a clash of values. Between an older way of viewing certain things like community, family, country, and property and the newer, more urban way of viewing these things and the country or rural space as simply a place of leisure to be consumed like anything else. To be entered and then vacated. It seemed clear that something serious was being lost for the locals.

Yet I can’t help but feeling that the conflict was over before it actually began. Many people will of course argue that this is simply a function of market forces and therefore should not be resisted or interfered with in the name of ‘values’. This is a peculiar feature of the neo-conservative philosophy that sacrifices itself constantly at the altar of the market. It refuses to consider values that would limit its reach or resists its force. (I realize that the economic picture is more complicated by negative externalities and market failures and the importance of regulation in those circumstances but this is a closed loop of utilitarian argumentation anyways.) What I am saying is that this ideology refuses to consider non-utilitarian values in limiting its power. Many of these non-utilitarian values are discounted by the proponents of this view as simply being archaic and ‘old fashioned’ being held by the naïve and un-educated ‘rural’ folk who ‘just don’t understand how the world really works’. Of course, these two groups of people, the rural and the urban (to use a quick and handy dichotomy which leaves a lot out of it) live in different worlds, one of which is invading the other. Certainly the rural don’t understand how the urban, market driven world works yet its being foisted upon them anyways.

So that is how she goes. That is a brief hint at my take on the whole thing. But I am interested in hearing what you guys think about it. Don’t be afraid to leave a comment or post on your own blogs on the problem. I guess, that is if you view it as a problem.