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The fundamentals that create an opportunity for speculative investment is a lack of supply and an excess of demand. It's very rare that investment itself, in a
by erispoe 10y ago
The fundamentals that create an opportunity for speculative investment is a lack of supply and an excess of demand. It's very rare that investment itself, in a vacuum of demand, will result in a price surge. Sure, it can happen, but the basics is that Portland is attractive and, like San Francisco, does not build enough to support the new demand.
- skybrian 10y agoIt sounds like you're saying that investment alone doesn't make a bubble. But investment (or speculation) is another kind of demand, and it's well known that speculation can create bubbles when investors predict future demand that turns out not to exist. So I'm not really sure what you're getting at?
- erispoe 10y agoReal demand for housing is here in Portland and in San Francisco. It's not created by real estate speculation. Real people, by the thousands, come to these metro areas, faster than the housing stock grows to accommodate them. Before asking ourselves if price surges are created by the smokes and mirrors of speculation, a second-degree hypothesis, we ought to look at the simpler hypothesis first: is there a real demand for housing? Yes, there is. Is the housing stock growing fast enough to satisfy that demand? No, it is not.