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I think to be clear - firstly it's a hot topic in Cornwall not because of nimby-ism but because the developments are all pitched at hyper wealthy individuals, w

by dmje 3y ago

I think to be clear - firstly it's a hot topic in Cornwall not because of nimby-ism but because the developments are all pitched at hyper wealthy individuals, whether retirement individuals with £500k to spunk on a 1-bed per my example or people from outside the region who are buying holiday homes at similarly inflated values. I don't think anyone locally would say "don't build", instead it's "please build for locals" (where "local" = normal locally employed person). Secondly, my point is kind of more general. I think if anyone with reasonable intelligence were given £1m they could make fairly reasonable profits in fairly short time, possibly from land or maybe from other investments. Of course there are risky investment strategies that could easily see them losing the lot but in general I think you'd be hard pushed to not find some level of success given this initial starting point.

johngladtj 3y ago
Do you think that rich people pop out of thin air whenever a new luxury home is built? They don't. They move out of their existing homes into the new luxury homes... And the existing homes they just left now become affordable.
ZephyrBlu 3y ago
> but in general I think you'd be hard pushed to not find some level of success given this initial starting point What does this even mean? "some level of success" as in sticking it in the stock market and collecting ~7-10%, or more than that? If you think that anyone with capital can generate above-market returns, that is a very odd perspective. Capital is relatively abundant. If you can reliably generate above-market returns with $1M+ you should try to raise capital.
_dain_ 3y ago
>the developments are all pitched at hyper wealthy individuals, whether retirement individuals with £500k to spunk on a 1-bed per my example or people from outside the region who are buying holiday homes at similarly inflated values. I don't think anyone locally would say "don't build", instead it's "please build for locals" (where "local" = normal locally employed person). They really do say "don't build". Or rather, their actions (revealed preference) say "don't build", regardless of what comes out of their mouths. Housing developments that would be affordable to normal people get blocked all the time. There are too many people with veto power, and someone can almost always find an excuse to say "no". So what does get built is biased towards the luxury end, by necessity. Developers have to make up in margin what they lose in volume. There's no way around this. Think about it: if you make it illegal to build holiday homes, that doesn't get rid of the demand for holiday homes, does it? Those same wealthy people will be competing over a smaller stock of possible housing, i.e. the very same housing that local people want to live in. So the prices will still go up! What you're proposing cannot possibly work, unless you want to make it literally illegal for outsiders to move in. When you artificially restrict supply, you get a shortage. It's not rocket science.

by dmje 3y ago

johngladtj 3y ago

Do you think that rich people pop out of thin air whenever a new luxury home is built? They don't. They move out of their existing homes into the new luxury homes... And the existing homes they just left now become affordable.

ZephyrBlu 3y ago

> but in general I think you'd be hard pushed to not find some level of success given this initial starting point What does this even mean? "some level of success" as in sticking it in the stock market and collecting ~7-10%, or more than that? If you think that anyone with capital can generate above-market returns, that is a very odd perspective. Capital is relatively abundant. If you can reliably generate above-market returns with $1M+ you should try to raise capital.

_dain_ 3y ago

>the developments are all pitched at hyper wealthy individuals, whether retirement individuals with £500k to spunk on a 1-bed per my example or people from outside the region who are buying holiday homes at similarly inflated values. I don't think anyone locally would say "don't build", instead it's "please build for locals" (where "local" = normal locally employed person). They really do say "don't build". Or rather, their actions (revealed preference) say "don't build", regardless of what comes out of their mouths. Housing developments that would be affordable to normal people get blocked all the time. There are too many people with veto power, and someone can almost always find an excuse to say "no". So what does get built is biased towards the luxury end, by necessity. Developers have to make up in margin what they lose in volume. There's no way around this. Think about it: if you make it illegal to build holiday homes, that doesn't get rid of the demand for holiday homes, does it? Those same wealthy people will be competing over a smaller stock of possible housing, i.e. the very same housing that local people want to live in. So the prices will still go up! What you're proposing cannot possibly work, unless you want to make it literally illegal for outsiders to move in. When you artificially restrict supply, you get a shortage. It's not rocket science.