Friday, May 4, 2007

When Moncton is ahead of you, Something ain't right

Civic cheerleaders and local media have been jumping with joy over the ranking of London as the "8th best city to live" by Money Sense Magazine.

The cities were ranked according to "livable factors" such as unemployment, growth rates, crime, new vehicle ownership, weather, and housing prices.

While everything sounds rosy for London, the statistics of this survey must be questioned.

Firstly, most of the cities that are in the "top ten" are the capitals of their respective jurisdictions, which make them heavily dependent on government civil servant jobs and government funding in general. As well, non-capital cities such as Kingston and London contain a high institutionalize workforce in education, medical, and/or correctional facilities.

This, by default, makes these cities immune to any instability in the economy including recessions. The unemployment rates are therefore relatively inflexible.

Secondly, the validity regarding low housing costs are deceptive since they do not take into account property tax rates. Although the price of housing is relatively inexpensive the the majority of the "top ten" cities, their residential tax rates are not disclosed. This brings a false sense of lower real estate prices.

Even though the capital costs of a home may be lower, the tax expenses related to the property could outweigh the initial purchase savings in the long-term.

Thirdly, The use of newer cars as a measurement of community wealth is meaningless since new vehicle ownership crosses numerous economic demographics. Although many people in a particular city may have newer vehicles, this does not mean that the owners are considered "wealthy" by any means. Most likely, it means that the vehicle was purchased via interest financing or a long-term lease.

Also, many people who own older vehicles may belong to a more affluent demographic. For example, someone who owns a classic car would be considered "poorer" because they happen to not own a new car.

Fourthly, the crime statistics in the survey only take into account the homicide rates in each respective municipality and not the general crime rates as a whole. This is another misnomer.

Although the murder rates may low, the crime rates for other serious forms of crime such as assaults, robberies, and thefts could be uncorrelated to the murder rates. Thus, the crime rate as a whole in a city could be much higher due to the high forms of non-homicide related offenses.

Finally, the weather in one community over another does not accurately reflect the livability of a community. The likes and dislikes of different types of weather vary from person to person. Some people like the cold and snow, others like warm and sunshine.

The survey arbitrarily decides that most people like to live in cities with low amounts of precipitation and with higher number of days when the temperature is above 30 degrees C.

The survey as a whole should be taken with a grain of salt as it has many forms of frivilous and biased statistical information that are unrelated to the safety, income levels, and economic activity of any city including London.

If Money Sense used more relative measurements on livability and economic prosperity such as broad crime rates, residential property tax rates, private sector and infrastructure investment, and amount of bureaucratic red tape on property owners--London would score much lower that 8 out of 123.

2 comments:

mariposa said...

I found the rating interesting, and I too wondered about the lack of information on property taxes. Another issue I have with this city - other than our outrageous taxes - is the air quality, specifically as it relates to allergies. Now there's really nothing the city can do about seasonal allergy causes - after all, we live in a valley. But, I'm weighing my options and trying to decide if relocation to another less heavily taxed city with better air quality would be a good idea. There's a lot to like about London, but our fiscally irresponsible municipal government isn't one.

Mitch said...

To expand on your comment - as my father always said - "it's not what you own but what you owe". How many of these "affordable houses" are leveraged to the hilt?

Heck, my neighbour married into the Irving family over 15 years ago - she told me they drove old Buicks all the time. Does that mean that by this measure they're not "wealthy"