5 ms·
I don’t understand how the article can bemoan high rents but then also say urban cores are overbuilt? Overbuilding drives down rents, which isn’t great for deve
by dahdum 9y ago
I don’t understand how the article can bemoan high rents but then also say urban cores are overbuilt? Overbuilding drives down rents, which isn’t great for developers but not exactly a problem for the rest of us.
Miami is going through the same, so many condo towers are going up it’s suppressing rents - in the most expensive area of the city. Yes, they are premium units, but the supply drives down rents across the board.
- DubiousPusher 9y agoI don't think they're saying that the cities are overbuilt in the short term but could be overbuilt in the long term. It can take decades for a large apartment building to show an ROI. A significant decline in renters, even over 10-15 years can leave large development projects without the money to maintain the buildings and grounds. Gross looking buildings of course struggle even more to attract renters and a neighborhood can go into a downward spiral in as little as a decade.
- Steltek 9y agoI'm guessing it's because many cities still strangle development. "Overbuilt" could be concluded from a lack of feasible projects within a city. There's also the nebulous problem of investors buying units in new luxury buildings but not occupying or renting them. This could preserve high rent prices as new units are not being faithfully put into the housing pool. Stories about that pop up often but don't seem quantified as an issue.