4 ms·

That's like saying no deserves economic gains by investing in the stock market. You are complaining you were too young and not rich enough to buy Microsoft or

by ipaddr 3y ago

That's like saying no deserves economic gains by investing in the stock market. You are complaining you were too young and not rich enough to buy Microsoft or Apple shares from the start and feel you will never catch up to those. Write your own story. Find a city with home prices similiar to Toronto 40 years buy and wait. Toronto 40 years ago was very different from the city you know. You had farm land, military bases, going to Yorkdale by bus was two bus tickets. Toronto has grown the people who bet on Toronto were rewarded. It could have went the other way if Quebec didn't almost leave Canada which moved invest from Montreal to Toronto. The Toronto stock exchange at the time was mainly mining financing.

epistasis 3y ago
No, the stock market is exactly the opposite of real estate investing. Land is finite, capital is not. Speculation on land value is non-productive, whereas capitalization of productive economic firms is precisely the definition of economic productivity. Real estate gains, when they are not from development, are all rentierism, the enemy of economists of all sorts.
- deathless 3y ago
  We are so far from exhausting usable land that this argument is ridiculous. There will be more cities. 3rd tier cities will become 1st tier cities (and probably vice versa). Go invest in a city or town wisely (and don't forget to be lucky!) and you will be rewarded.
  - epistasis 3y ago
    Land is all about location, and what is near it. The idea that you could build out in a field ignores the true value and the true finiteness of land, the geography of agglomerations of skill and people.
    - Tiktaalik 3y ago
      Also drive around and you'll find that not all land is created equal. Much of Canada muskeg, tundra, and just awful places to be, which is why no one lives there. British Columbia looks big on a map, turn on the topographic layer and oops it's all mountain. No wonder everyone lives in a handful of tiny valleys. And oops we flooded tons of the valleys for hydro power too, further driving down the actual available prime land one can live on. If no one lives in a place there's usually a good reason.
  - lotsofpulp 3y ago
    Are there any examples of 3rd tier cities becoming 1st tier? The situation seems the opposite, the NYC/SF/LA/London/etc are entrenched.
    - djkivi 3y ago
      Dubai wasn't much 30 years ago. https://www.businessinsider.com/dubai-in-1990-is-totally-unrecognizable-2013-12 https://www.businessinsider.com/dubai-in-1990-is-totally-unr...
      - lotsofpulp 3y ago
        Sorry, I meant 1st tier cities becoming 3rd tier.
        jjav 3y ago
        Detroit
      - lawkwok 3y ago
        Isn’t it really expensive to live there? Also, while Dubai is flashy, I wouldn’t really consider it a first tier city in terms of actual living. The urban planning is not human scale at all and they just defaulted to highways and skyscrapers.
      - harambae 3y ago
        Or Shenzhen. But I think he means western examples. San Diego maybe?
  - gassiss 3y ago
    and that's the main issue with Canada, there's not enough houses being built. And no interest in doing so, apparently
    - theironhammer 3y ago
      40% of Federal MPs are landlords. Haven't got figures for Provincial MPs or Municipal representatives but I'll wager a substantial amount are landlords too.
- Spivak 3y ago
  Yes but we're not running out of land in any meaningful sense of the word. There is nothing at all preventing you from investing in the development of a yet undiscovered area and betting it will blow up. If you're not choosey you can buy land so cheap it might as well be free if you want to start from scratch too. If your bet comes to fruition you'll be richer than god and you'll be the catalyst for so much growth and economic development it will make the stock market blush.
  - epistasis 3y ago
    We are completely out of land in Canada and elsewhere, because prices are going through the roof, because the thing that matter most about land is location. Land is not fungible, you can't exchance an acre of downtown Vancouver for an acre in a rural area. Nobody would ever confuse the two when it comes to economics! Land value is all about access, about who is near by, about what natural resources are near by. When real estate prices go up without construction, land value is increasing. In the US, restrictive zoning limits workers from moving into productive areas and being able to use their labor for more productive ends. This has been a tremendous drag on our GDP, while simultaneously concentrating wealth into the unproductive hands of landowners. The first paper to point this out made big errors, leading to an underestimate of this effect: https://www.econlib.org/a-correction-on-housing-regulation/ https://www.econlib.org/a-correction-on-housing-regulation/ This is the difference between gains from land use and gains from the stock market: one reduces overall wealth and concentrates wealth to those with the most; stock market investing does the opposite.
    - Spivak 3y ago
      This is only true if your definition of land is constrained to the teeny tiny fraction of land that is already developed into highly desirable cities. Which in real estate terms is like trying to buy a stock at its peak and complaining it's expensive. I am in no way saying that burdensome regulation hasn't artificially limited the growth of existing metro areas and caused a bubble driven by artificial scarcity but the idea that there's nowhere to invest in at the ground floor where it's cheap is absurd. This happens in cities on a smaller scale already. The nice areas are too expensive so young artsy people move where its cheap, make it better, and then it becomes a good area -- repeat. If you invested in the development of say, Akron Ohio with the goal of tipping the scales and starting flywheel of metropolitan growth and your bet pays off not only will you be filthy filthy rich but you'll create brand new economic activity and real growth. Of course fighting over the same 100 sq miles is a zero sum game. As an individual laborer your choices are obviously limited to where you can find work but as an investor the sky is the limit.
- RedCondor 3y ago
  >the stock market is exactly the opposite of real estate investing. Land is finite, capital is not. This is where you go wrong. Unlike posters defending real estate "investment," I'll criticize you from the opposite end: capital markets are a disguised form of the same old rentierism. Watch out, lest you become a Clevinger.
jonny_eh 3y ago
> You are complaining you were too young and not rich enough to buy Microsoft or Apple shares You don't need to buy tech stocks to avoid becoming homeless. You do need to rent/own at least one home though.
deathless 3y ago
It's like saying no one deserves anything but an hourly wage, and damn anyone that actually builds something. And yeah, it was "easier" yesterday than today, given today's knowledge of the winners. Today is easier than tomorrow, if you know tomorrow's winners. The internet / pop-culture narrative of "everything is against me, I'm too late, and there's nothing I can do about it" is actually great for people that want to go out and do something about it. The competition is sitting around bitching on Reddit.
- epistasis 3y ago
  People deserve the fruits of their own labor. They do not "deserve" to charge rent to others. And appreciation of real estate without productive labor to improve that particular parcel is collecting the work of others.
- izacus 3y ago
  Oh come on - the wealth realized here wasn't gained by building more for everyone, but by making sure others don't build their homes so the exiting owners gain wealth without actually creating anything.
  - paulryanrogers 3y ago
    And if voting NIMBY they're pulling the ladder up, denying their neighbors the same benefit. Strikes me as parasitic behavior. I was generally taught to buy only what one needs and can maintain, and work for wealth. Maybe naive, but the rent seeking and praise of extractive wealth is noxious the more I learn to recognize it.
- bugglebeetle 3y ago
  The wealth was not generated by the person doing anything, but by all the activity occurring around them! Adam Smith despised landlords and wealth accumulation based on land-ownership for exactly this reason. They’re a parasitic drag on market economies that shifts capital from productive activities to unproductive ones (i.e. speculating on real estate). “As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed, and demand a rent even for its natural produce.”
gassiss 3y ago
this strategy goes down the drain for any profession that relies on being on one of the big cities to thrive. What do you suggest for those people?

by ipaddr 3y ago

epistasis 3y ago

No, the stock market is exactly the opposite of real estate investing. Land is finite, capital is not. Speculation on land value is non-productive, whereas capitalization of productive economic firms is precisely the definition of economic productivity. Real estate gains, when they are not from development, are all rentierism, the enemy of economists of all sorts.

deathless 3y ago
We are so far from exhausting usable land that this argument is ridiculous. There will be more cities. 3rd tier cities will become 1st tier cities (and probably vice versa). Go invest in a city or town wisely (and don't forget to be lucky!) and you will be rewarded.
- epistasis 3y ago
  Land is all about location, and what is near it. The idea that you could build out in a field ignores the true value and the true finiteness of land, the geography of agglomerations of skill and people.
  - Tiktaalik 3y ago
    Also drive around and you'll find that not all land is created equal. Much of Canada muskeg, tundra, and just awful places to be, which is why no one lives there. British Columbia looks big on a map, turn on the topographic layer and oops it's all mountain. No wonder everyone lives in a handful of tiny valleys. And oops we flooded tons of the valleys for hydro power too, further driving down the actual available prime land one can live on. If no one lives in a place there's usually a good reason.
- lotsofpulp 3y ago
  Are there any examples of 3rd tier cities becoming 1st tier? The situation seems the opposite, the NYC/SF/LA/London/etc are entrenched.
  - djkivi 3y ago
    Dubai wasn't much 30 years ago. https://www.businessinsider.com/dubai-in-1990-is-totally-unrecognizable-2013-12 https://www.businessinsider.com/dubai-in-1990-is-totally-unr...
    - lotsofpulp 3y ago
      Sorry, I meant 1st tier cities becoming 3rd tier.
      - jjav 3y ago
        Detroit
    - lawkwok 3y ago
      Isn’t it really expensive to live there? Also, while Dubai is flashy, I wouldn’t really consider it a first tier city in terms of actual living. The urban planning is not human scale at all and they just defaulted to highways and skyscrapers.
    - harambae 3y ago
      Or Shenzhen. But I think he means western examples. San Diego maybe?
- gassiss 3y ago
  and that's the main issue with Canada, there's not enough houses being built. And no interest in doing so, apparently
  - theironhammer 3y ago
    40% of Federal MPs are landlords. Haven't got figures for Provincial MPs or Municipal representatives but I'll wager a substantial amount are landlords too.
Spivak 3y ago
Yes but we're not running out of land in any meaningful sense of the word. There is nothing at all preventing you from investing in the development of a yet undiscovered area and betting it will blow up. If you're not choosey you can buy land so cheap it might as well be free if you want to start from scratch too. If your bet comes to fruition you'll be richer than god and you'll be the catalyst for so much growth and economic development it will make the stock market blush.
- epistasis 3y ago
  We are completely out of land in Canada and elsewhere, because prices are going through the roof, because the thing that matter most about land is location. Land is not fungible, you can't exchance an acre of downtown Vancouver for an acre in a rural area. Nobody would ever confuse the two when it comes to economics! Land value is all about access, about who is near by, about what natural resources are near by. When real estate prices go up without construction, land value is increasing. In the US, restrictive zoning limits workers from moving into productive areas and being able to use their labor for more productive ends. This has been a tremendous drag on our GDP, while simultaneously concentrating wealth into the unproductive hands of landowners. The first paper to point this out made big errors, leading to an underestimate of this effect: https://www.econlib.org/a-correction-on-housing-regulation/ https://www.econlib.org/a-correction-on-housing-regulation/ This is the difference between gains from land use and gains from the stock market: one reduces overall wealth and concentrates wealth to those with the most; stock market investing does the opposite.
  - Spivak 3y ago
    This is only true if your definition of land is constrained to the teeny tiny fraction of land that is already developed into highly desirable cities. Which in real estate terms is like trying to buy a stock at its peak and complaining it's expensive. I am in no way saying that burdensome regulation hasn't artificially limited the growth of existing metro areas and caused a bubble driven by artificial scarcity but the idea that there's nowhere to invest in at the ground floor where it's cheap is absurd. This happens in cities on a smaller scale already. The nice areas are too expensive so young artsy people move where its cheap, make it better, and then it becomes a good area -- repeat. If you invested in the development of say, Akron Ohio with the goal of tipping the scales and starting flywheel of metropolitan growth and your bet pays off not only will you be filthy filthy rich but you'll create brand new economic activity and real growth. Of course fighting over the same 100 sq miles is a zero sum game. As an individual laborer your choices are obviously limited to where you can find work but as an investor the sky is the limit.
RedCondor 3y ago
>the stock market is exactly the opposite of real estate investing. Land is finite, capital is not. This is where you go wrong. Unlike posters defending real estate "investment," I'll criticize you from the opposite end: capital markets are a disguised form of the same old rentierism. Watch out, lest you become a Clevinger.

jonny_eh 3y ago

> You are complaining you were too young and not rich enough to buy Microsoft or Apple shares You don't need to buy tech stocks to avoid becoming homeless. You do need to rent/own at least one home though.

deathless 3y ago

It's like saying no one deserves anything but an hourly wage, and damn anyone that actually builds something. And yeah, it was "easier" yesterday than today, given today's knowledge of the winners. Today is easier than tomorrow, if you know tomorrow's winners. The internet / pop-culture narrative of "everything is against me, I'm too late, and there's nothing I can do about it" is actually great for people that want to go out and do something about it. The competition is sitting around bitching on Reddit.

epistasis 3y ago
People deserve the fruits of their own labor. They do not "deserve" to charge rent to others. And appreciation of real estate without productive labor to improve that particular parcel is collecting the work of others.
izacus 3y ago
Oh come on - the wealth realized here wasn't gained by building more for everyone, but by making sure others don't build their homes so the exiting owners gain wealth without actually creating anything.
- paulryanrogers 3y ago
  And if voting NIMBY they're pulling the ladder up, denying their neighbors the same benefit. Strikes me as parasitic behavior. I was generally taught to buy only what one needs and can maintain, and work for wealth. Maybe naive, but the rent seeking and praise of extractive wealth is noxious the more I learn to recognize it.
bugglebeetle 3y ago
The wealth was not generated by the person doing anything, but by all the activity occurring around them! Adam Smith despised landlords and wealth accumulation based on land-ownership for exactly this reason. They’re a parasitic drag on market economies that shifts capital from productive activities to unproductive ones (i.e. speculating on real estate). “As soon as the land of any country has all become private property, the landlords, like all other men, love to reap where they never sowed, and demand a rent even for its natural produce.”

gassiss 3y ago

this strategy goes down the drain for any profession that relies on being on one of the big cities to thrive. What do you suggest for those people?