4 ms·
Making building more homes easier addresses this. Price-fixing that is not done via consolidation is ultimately unstable from game theory point of view. There
by kilotaras 4y ago
Making building more homes easier addresses this.
Price-fixing that is not done via consolidation is ultimately unstable from game theory point of view.
There's very strong incentive to defect from "optimal vacancy rate" and eat outsized profit compared to the rest of competition. Making building easier makes consolidation harder, as outsiders are now potential defectors as well. AFAIK we're not in monopoly situation (yet?) for rental properties.
Most of YieldStar value proposition on the other hand is ultimately just a price discovery mechanism. Prices raise because people *are willing* to pay that much for apartment. People are willing to pay that much, because supply doesn't keep with demand.
- ericd 4y agoYep, well put. It's only able to boost rents because the market clearing rate is higher than it is. Vacancy is extremely expensive, and there are too many small market participants to make it worth taking vacancy in exchange for boosting the rents on the other units.