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No, that's not right. First, there might not be enough demand for the most expensive places, only so many people can buy a 20 million dollar apartment. There's
by Latteland 8y ago
No, that's not right. First, there might not be enough demand for the most expensive places, only so many people can buy a 20 million dollar apartment. There's no magic power law that means that supply of housing works in a way that someone stepping up always makes a space for someone below. Also, the cost of a top end place could often pay for many many more lower end housing. Generally it seems easier to make a profit on expensive housing or whatever, because cost matters less in the final profit (that takes lots of discipline to make profits on more units of cheaper things generally).
- ironmagma 8y ago> only so many people can buy a 20 million dollar apartment Yes, and that's what turns the 20 million dollar apartment into a 10 million dollar apartment. If prices are too high, the market will correct for that by having apartment complexes needing to rent out units for less than they cost to build. That is why market research is important and should be on the developer to determine what there is demand for.
- johnchristopher 8y agoI heard the market corrected in Spain by allowing multiple generation loans https://www.dailymail.co.uk/news/article-2537511/The-40-year-old-mortgage-pass-children-House-price-boom-forces-buyers-opt-two-generation-loans.html https://www.dailymail.co.uk/news/article-2537511/The-40-year...