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The Value of Worth

March 4, 2021   ·   0 Comments

By Constance Scrafield

The real estate market has gone mad and when one part of the economy is out of balance, so, before long, will the rest of the economy follow. Call it inflation. Call it a loss of respect for worth, which is nominally synonymous with value, yet carries a higher distinction. So, property is valued at much more than it’s worth, yet the needs of the many for affordable homes are undervalued.

Let real estate be the case in point. Mediocre, ordinary and average sized houses in Toronto, and nevermind Toronto, how about here in Orangeville and environs, are selling for prices unimaginable three years ago. A million dollars is actually quite a bit of money but now it can only buy a relatively unremarkable property. 

It is very much a prime source of conversation: agents scrambling to find people who want to part with their homes for ridiculous sums and then try to figure out where they are going to live next – further away- east, north. Lots of foreign investment is about to substantially change the nature of neighbourhoods, particularly in the countryside.

For sure, this disproportionate rise in property prices compared to the worth of those properties will influence the cost of everything else. While “stress tests” for mortgages were tightened and relatively stringent a few years ago, with required proof of substantial down payments and evidence that the prospective buyers could afford their mortgages with an increase in interest – those have been loosened…

Is history going to play that stupid old tune again: too many properties for too high a price and too many buyers without a strong enough long-term plan to hang on? Too many bankruptcies and foreclosures in the winds. Never mind what it all does to already damaged economies.
Or is it? 

What is the muddle between price and value? How does the mediocre warrant high return when the valuable is still underpriced? What is the worth of the environment? This provincial government is dealing fast and loose with the environment, cutting back the green spaces, as Doug Ford panders to developers. In this time of inflated property prices, the Golden Horseshoe, the Niagara Escarpment, the Oak Ridges Moraine and the Conservation areas are going under the hammer so that developers can grow too rich for building in sensitive areas – the very thing scientists and environmentalists are urging us to stop.

A large part of this problem of the pressure to infringe on green spaces began with the impoverished municipal planning across southern Ontario. Small towns have mysteriously, in my view, agreed to the cookie-cutter plan of box stores building identical malls, allowing the mind-numbing sprawl on the outskirts of every small town. This mis-guided acquiescence to consuming far too much land and rendering the roads into one town after another to be exactly the same is simply bizarre. And corrupt? How has this happened?

Crummy houses are overpriced like a joke and youngsters are on the streets and young women are being trafficked. Meanwhile, people are homeless, impoverished; the elderly are shoved into miserable “homes;” children are struggling with this never-ending social chaos that is the pandemic.

The pandemic.

Here again the conflict between money and worth has reached new levels. The pandemic has lasted so long; on reflection, much longer than it should have. What is the cause of this? Meandering government policies, changing and vacillating as though caught in a storm, for a start. However, people too: not wearing masks, gathering in large groups; but who is benefitting to an obscene extent?

Where is the internet in all this: people are marching against something as mundane as wearing masks, which is quite the norm in many countries. How have people been convinced to fly stupidly in the overwhelming face of science, to deny the truth of how it is spread? They believe what they read online and the internet is awash in mis-information. It seems horrid to think that there could be a wish to extend the harm Coronavirus is doing maybe but what about a delivery company whose CEO is the richest man in the world; small businesses fail while mega retailers thrive. Stranger things have happened online, unbelievable influences brought to bear on so many unwary people. 

In the 1980’s, mortgage rates soared to 21 per cent. Don’t say it could never happen again: mortgage rates have been double digits for years. It is the current time that is making history with interest rates standing so low. Investments are see-sawing and Wall Street was well mocked earlier this year. Money is volatile. A person can be rich, poor and rich again on the market’s whim. 

Yet, worth is consistent because it is tied to more than the dollar value of a thing, an idea or a promise. Can still be, a person’s word is based on their worthiness. These are dangerous times and the worth of an action, a price tag, a source of information must balance with its cost and effect.

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