One of the Klubbers raised the issue of the change in land prices since Williams first started the land assembly for what became Glencrest and then Galway. The idea – apparently - was that Williams’ asking price for the land was justified since prices had climbed a lot since 1997.
That leaves out a whole whack of details that we’ll return to in another post. For now, let’s take a look at the change in land prices since 1997. The source for the information is Statistics Canada’s monthly report of house prices, that breaks down the price for the house and land in a typical parcel.
There’s a steady growth in prices until that big jump that coincides with the announcement of the Hebron final deal in 2008. If you trace that incline backwards slightly you’ll get the foot of the climb at around the time in 2007 when the provincial government announced the agreement in principle for Hebron.
The next climb between Hebron and the “stimulus” coincides with the massive increase in public sector salaries following the 2007 election and the expansion of the public service. The “stimulus” was the massive capital works program and deficit spending that continues to date.
All that private sector spending and the massive public sector spending did a nice job of inflating house and land prices in the metro St. John's region. None of that means that what's going on with the purchase of land from Williams' development is good or bad. It just gives some context to the discussion. There's more context that we will consider over the next few days.