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> If zoning restrictions are relaxed and developer turns an acre into a 50 unit condo complex, that developer reaps a huge windfall. But everyone else who owns
by maxsilver 7y ago
> If zoning restrictions are relaxed and developer turns an acre into a 50 unit condo complex, that developer reaps a huge windfall. But everyone else who owns an Eichler on a 1/4 acre has fewer buyers competing for their property.
That's not completely accurate. Yes, demand might fall, but even so price and value will still rise regardless.
If you build a 50 unit complex next door, as long as some of those 50 units sell, then everyone elses 1/4th acre will become more valuable, even if no one ever actually buys them, because land value in the US has very little to do with buyers or demand, and is exclusively valued by whatever property transactions happen to occur nearby it.
- deleted 7y ago[deleted]
- jonny_eh 7y agoPlus the single family home will be just as desirable. New condos are still less desirable in comparison.
- DrScump 7y agoland value in the US has very little to do with buyers or demand, and is exclusively valued by whatever property transactions happen to occur nearby it I don't understand the distinction you seek to make here. Those transaction values are specifically the result of buyers and demand. Most residential properties here could have been snapped up in 2009 for about 60% of current costs... because demand was lower. (Probably several hundred percent in areas like Mission Bay.)
- pcwalton 7y agoThought experiment: If 500,000 new homes were suddenly available in San Francisco tomorrow, would prices decrease? Land value in the US obviously has to do with buyers and demand.