4 ms·

Supply and demand is too simplistic an approach for a lot of places when so many properties in major cities are purchased by foreign investors and left empty.

by kjakm 6y ago

goodcanadian 6y ago
Supply and demand still works. That is a confounding factor artificially increasing demand (or decreasing supply). There are lots of approaches to fight this, including banning foreign ownership, or just building so much housing that it doesn't matter (the foreign ownership problem may also go away in the latter case if it turns into a poor investment).
- Jochim 6y ago
  Building housing isn't enough. People need to be able to get to work in a reasonable length of time, they generally need to be able to maintain prior relationships, have access to hobbies, shopping etc. that all tend to be further away from undeveloped land. That's also ignoring the problem of landlords using the excess capital extracted from rents to drive the price of housing further from the reach of the people actually interested in using it as a house. The higher prices are then used by landlords as a justification for raising rent, and this cycle then repeats.
twic 6y ago
> so many properties in major cities are purchased by foreign investors and left empty This is a bit of a popular myth. Vancouver is the only city i know of where it even approaches being significant. Try to dig up some statistics on empty properties for some cities that matter to you and you'll see.
- kjakm 6y ago
  There are about 25,000 unoccupied properties in London, UK worth about £11 billion.
  - twic 6y ago
    That's all homes empty for any reason, not just "purchased by foreign investors and left empty", which is what i'm talking about. It's still a tiny number compared to the size of the city. Here's a report, covering England but with some extra detail on London, from 2019: https://www.actiononemptyhomes.org/Handlers/Download.ashx?IDMF=68fa9a2d-83f5-4ca4-936b-a8d8248484c0 https://www.actiononemptyhomes.org/Handlers/Download.ashx?ID... Table 5 tells us that in London, there were a grand total of 2126 empty homes in council tax bands G and H, ie the kind of property an investor might buy. The vast majority of empty homes are not offshore investment material.

Supply and demand is too simplistic an approach for a lot of places when so many properties in major cities are purchased by foreign investors and left empty.

by kjakm 6y ago

Supply and demand is too simplistic an approach for a lot of places when so many properties in major cities are purchased by foreign investors and left empty.

goodcanadian 6y ago

Supply and demand still works. That is a confounding factor artificially increasing demand (or decreasing supply). There are lots of approaches to fight this, including banning foreign ownership, or just building so much housing that it doesn't matter (the foreign ownership problem may also go away in the latter case if it turns into a poor investment).

Jochim 6y ago
Building housing isn't enough. People need to be able to get to work in a reasonable length of time, they generally need to be able to maintain prior relationships, have access to hobbies, shopping etc. that all tend to be further away from undeveloped land. That's also ignoring the problem of landlords using the excess capital extracted from rents to drive the price of housing further from the reach of the people actually interested in using it as a house. The higher prices are then used by landlords as a justification for raising rent, and this cycle then repeats.

twic 6y ago

> so many properties in major cities are purchased by foreign investors and left empty This is a bit of a popular myth. Vancouver is the only city i know of where it even approaches being significant. Try to dig up some statistics on empty properties for some cities that matter to you and you'll see.

kjakm 6y ago
There are about 25,000 unoccupied properties in London, UK worth about £11 billion.
- twic 6y ago
  That's all homes empty for any reason, not just "purchased by foreign investors and left empty", which is what i'm talking about. It's still a tiny number compared to the size of the city. Here's a report, covering England but with some extra detail on London, from 2019: https://www.actiononemptyhomes.org/Handlers/Download.ashx?IDMF=68fa9a2d-83f5-4ca4-936b-a8d8248484c0 https://www.actiononemptyhomes.org/Handlers/Download.ashx?ID... Table 5 tells us that in London, there were a grand total of 2126 empty homes in council tax bands G and H, ie the kind of property an investor might buy. The vast majority of empty homes are not offshore investment material.