Saturday, June 2, 2007

Alberta versus Texas

Cost of a starter home in Edmonton or Calgary-$400k.
Cost of a starter home in Austin Texas - $120k
Does anyone even remember the days when housing was pretty much in the same range in Alberta. I do.

But Alberta is of course very different now as we have oil sands.

And oil sands somehow reduce the free available land for housing developments, as per a number of bullish Alberta investors. The impact can go as far as thousand kilometers away from the oil sands fields causing drastic reduction in available land in Edmonton, Red Deer and Calgary and beyond. Oil Sands also tend to reduce the availability of timber from our neighboring province inasmuch as the days of cheap natural gas used to extract the oil sands are coming to an end and pretty soon they'll have to get 'medieval' and start burning all this wood for extracting the oil from sands.
And we don't have any illegal hispanic workers from Mexico doing our work dirt cheap.
Also, what does Texas know about culture? Alberta is the home of biggest rodeo on the planet and nothing really can compete with it.
And in terms of economic prowess, what is Texas as compared to Alberta. It would only be a measly economy just about the size of Canada. It only has around 110 companies in the Fortune 1000 list as compared to an incomparable 4 or 5 in Alberta.
And income taxes in Texas are so high as compared to those in Alberta. Ours are only 10% while they have a high of zero percent.

So you see, things are very different in Alberta that bump up our prices by more than 3 times the prices in Texas.

I have tried very hard to come out with the above fundamental explanation for the phenomenon. I think it will help restore some 'balance' a lot of people have complained about that his blog is lacking.
Have a good weekend everyone and try to stay cool on this hot day!
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