Comment 26457

By Undustrial (registered) - website | Posted September 04, 2008 at 00:53:41

Housing prices get inflated in many ways. One is by making credit really easy to get - something the market has seen the sad results of very recently. Another is by deregulating rental markets (helped, further, by the offering of credit to speculators and slumlords looking to make a quick and easy buck) and allowing rents to rise. And largely, one needs to look the way of speculation. Once prices, already on the rise due to financial factors, prove themselves to be a good investment speculation explodes, rising violently in areas such as Toronto, Vancouver or London, people simply keep bidding each other's prices up, like a giant ponzi scheme.

The housing market is, for bankers and developers, a literal license to print money. Banks can lend out many times their total assets, and yet still charge several times the value of the home in interest. All too often, tenants pay the mortgage. Sprawl allows land to be bought up for next to nothing, a bunch of cheaply-built houses thrown up as fast as possible, and tens or hundreds of thousands of these make-believe dollars to flow in for each mass-produced unit.

Of course this is more profitable than farming, especially given the fact that the average Ontario farm is now a net loser of money, thanks to its own woes of capitalization (big loans for seed, pesticides, fertilizer and machinery). Behind the headlines of higher yields, the Green Revolution has exacted quite a cost on the world of agriculture, one which we're only beginning to witness now.

The one plus to this story, is that if one is looking toward urban agriculture, suburbs tend to offer lots of space for it.

"Today, the notion of progress in a single line without goal or limit seems perhaps the most parochial notion of a very parochial century." — Lewis Mumford

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