Thursday 31 July 2014

Quote of the day - on residential property values


This is so true - it should be beaten into us all as we clamber up and down the so-called property ladder. It starts with the subsidising of housing provision under the New deal and, as Howard Ahmanson observes....

...instead of their forty acres and a mule, people got their ¼ acre and an automobile, the only practical way to travel from their ¼ acre to wherever they wanted to go. Eventually people came to see their ¼ acre with a house on it as an “investment,” and further, a “source of wealth.” But this was not a truly agrarian source of wealth. Farms depend for their value on the quality of their soil and their productivity as farms. They are truly commercial real estate. But residences depend for their value only to a minor degree on what is on the property itself, but rather on what is around it; and suburbanites demanded that covenants, or the Government in the form of City Hall or County Hall, control their neighbors and what is around them.

As they say, the rest is history. And, at times a pretty sorry history. Indeed a history that has trapped many of us into believing that owning a house isn't about getting a secure place to live but a shoot from the magic money tree. With the ironic conclusion that:

The suburban model, in the end, demanded that to preserve suburban values, that the building of suburbs be stopped!


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