Monday, 30 March 2015

Wealth, Worth and Geography

It's amazing how much of our lives are dictated by geography - homes, jobs, education, net worth, wealth. The opportunities available to us are incredibly dependent on where we live in the world.

Last week my family and I were away on our annual March Break vacation - a week at Walt Disney World - which meant a lengthy road trip through Ontario and the eastern U.S. It's a drive we've done many times over the years, but I was struck this time by the number of real estate billboards lining the highway and how low the prices on those billboards were.

I suppose I've never put much thought into the disparity in real estate values from town to town, region to region, province to province, country to country. I have always lived in and around the biggest city in the country, well known for having one of the most over inflated real estate markets in the world. To me, Toronto and GTA prices are the reality of what housing costs because I would never dream of living anywhere else.

My fifteen hundred square foot townhouse with its narrow backyard and postage stamp front garden is valued just shy of a half million dollars because of the neighbourhood it sits in. To me, that's normal. To most of the rest of the country, that probably seems insane.

We love our home and neighbourhood and would never consider moving further away from the city at the centre of our universe, but how different our lives would be if we did!

Moving to a more rural community a couple of hours in any direction would mean being able to buy a home twice this size for half the price. A mortgage-free, fully detached home on a great big chunk of land.

Moving elsewhere in Ontario, even near another city centre, would ensure we could still find work in our fields while living mortgage-free in an enormous family home.

Moving even further afield could mean even greater savings - those billboards showed homes a third the cost of ours. Making a move like that would mean we could pay off our mortgage on this house with enough left over to buy a couple of properties.

No mortgage would mean a significant lifestyle change: more money to put into savings, more disposable income to spend on vacations and outings, treats for the kids and everyday everything - much more financial security in the here-and-now, though we'd be sitting on a significantly smaller real estate nest egg for the future. Making the move from an expensive real estate market to an inexpensive one would mean an enormous change in our financial future.

We would never dream of moving away from this city that's always been the centre of our lives, but it's amazing how much geography can control a family's lifestyle simply because that's where they've always lived, that's where they've put down roots, that's where they see their future.

It's hard to believe how much simple geography can dictate the kind of job and income we can expect, the size and type of house we can afford, our net worth, disposable income and overall wealth.

Originally published as "Wealth, Worth and Geography" on my weekly column at

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