4 ms·
If large amounts of 1- and 2- bedroom condos or apartments are built in a fairly densely-populated city, how much are the very rich going to want to buy or rent
by karmelapple 7y ago
If large amounts of 1- and 2- bedroom condos or apartments are built in a fairly densely-populated city, how much are the very rich going to want to buy or rent these? They may want to own them and rent them out, but if they can’t make a profit, I don’t see why they’d want to do that.
Luxury condos attract investment from richer people all around the world, but imho, fairly standard 1 and 2 bedroom apartments likely wouldn’t, especially if they have to be rented.
Could that be a way to combat the inequality?
The biggest problem I can see: developers love building luxury condos since the profit is much higher than building non-luxury places.
- javagram 7y agoWhat exactly is the difference between a luxury and non-luxury condo/apartment? I think it’s mainly a few cheap cosmetic features like countertops and stainless steel refrigerators. Of course developers label everything new luxury because why wouldn’t you spend an additional 1% of your investment on these types of things? The cost of building a “non-luxury” building is almost identical. In either case, you need investors to put up the money to pay for construction and maintenance of the building until enough units have sold/rent to be self sustaining. So even if you build a slightly less cosmetically appealing building, you still need investor capital / “the rich” to do so.
- vannevar 7y agoIt depends on who you consider "very rich" and where the condos are. In many cities, a modest 1- or 2-bedroom condo can go anywhere from $500K to over $1M. The people who buy them are not extravagantly wealthy, but are part of the executive class that has seen its wages rise rapidly over the past 30 years, while median incomes are comparatively flat.