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They could cut rent drastically and people still might not show up. Also, if the owners start going bad on their debts there is a potentially cascading financi
by legitster 3y ago
They could cut rent drastically and people still might not show up.
Also, if the owners start going bad on their debts there is a potentially cascading financial problem for the city of San Francisco
- pessimizer 3y ago> They could cut rent drastically and people still might not show up. You could sell ice cream for 5 cents on a hot summer day and people might not buy it. Try it and find out; there has been speculation in the past that lowering prices raises sales.
- legitster 3y agoSure. But if you took out a huge mortgage to buy your ice cream business based on anticipated sales, there are certain prices you cannot go below without going bankrupt. In a way, this is worse with real estate. With ice cream you can always make up losses with volume (to a certain extent). With real estate you have a fixed supply. Moreover, if you drop the price to get a new tenant, you implicitly drop the price for all existing units as well.
- umeshunni 3y agoYou could sell ice cream for 5c in Antarctica in July and people might not buy it.