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> If that were the case, why has someone else not bid $1 more to buy that house and rent it out? Because capital is privatised and scarce, therefore a working-

> If that were the case, why has someone else not bid $1 more to buy that house and rent it out? Because capital is privatised and scarce, therefore a working-class family wishing to buy a home to live on cannot do so since they're outbid by those with capital. This leaves them with two choices: (1) pay rent to a middleman with capital, who buys the house, or (2) beg a private entity for a capital advance to be repaid with future expected cash flows, i.e. a bank loan. The fundamental issue was always there, but for a time the house prices where well within what working/middle-class people could afford. Now that capital, incl. behemoth investment funds, have pushed these prices well outside what most people can reasonably afford, it becomes much more visible. It's kinda silly that your take is "well why don't working-class people just bid $1 above Blackrock"?

sokoloff 5y ago
The question is “if Blackrock can buy and turn an immediate profit, why didn’t MAA, Starwood, AvalonBay, or one of 100 others not bid it up from the easy-money, too-cheap level?”
- noahtallen 5y ago
  From experience in Portland and Seattle, large management companies are purchasing as many properties as they possibly can.
  - sokoloff 5y ago
    Indeed. That’s what makes the bids high enough to leave limited immediate cash flow.
- andrepd 5y ago
  They do, hence the unsustainable bubble affecting property prices all over the world.
trgn 5y ago
> a working-class family wishing to buy a home to live What people picture is owning houses. Landtax will not meaningfully make that more affordable. It will make holding on to land more expensive, therefore really putting pressure to extract the most value from it. Homes really aren't doing that. That will mean more capital improvements; more units on smaller lots, more apartments, ... It will curb speculation, lower rents in the aggregate, but ownership of land will remain expensive, especially for poorly improved land like family homes.

sokoloff 5y ago

The question is “if Blackrock can buy and turn an immediate profit, why didn’t MAA, Starwood, AvalonBay, or one of 100 others not bid it up from the easy-money, too-cheap level?”

noahtallen 5y ago
From experience in Portland and Seattle, large management companies are purchasing as many properties as they possibly can.
- sokoloff 5y ago
  Indeed. That’s what makes the bids high enough to leave limited immediate cash flow.
andrepd 5y ago
They do, hence the unsustainable bubble affecting property prices all over the world.

trgn 5y ago

> a working-class family wishing to buy a home to live What people picture is owning houses. Landtax will not meaningfully make that more affordable. It will make holding on to land more expensive, therefore really putting pressure to extract the most value from it. Homes really aren't doing that. That will mean more capital improvements; more units on smaller lots, more apartments, ... It will curb speculation, lower rents in the aggregate, but ownership of land will remain expensive, especially for poorly improved land like family homes.