4 ms·

As soon as you announce a new subway station the vultures descend and prices will ratchet up as speculators by land and sit in it, waiting for the hither bidder

by all2 2y ago

As soon as you announce a new subway station the vultures descend and prices will ratchet up as speculators by land and sit in it, waiting for the hither bidder.

bostonvaulter2 2y ago
One part of the answer to that is a land value tax. That way the “vultures” won’t be able to simply sit on the property waiting for it to appreciate before selling it.
thanksgiving 2y ago
That means the demand is very high and we need to build even more subway stations until the “vultures” can’t arbitrage the market anymore.
- lotsofpulp 2y ago
  Crazy that you are being downvoted for applying the principles of supply and demand.
- all2 2y ago
  If I think through this; 1. Price varies based on desirability of a location. 2. Desirability varies based on many factors, including proximity to a city center or major business concerns, cost of living, crime rate, etc. 3. To optimize desirability until there is more desirable space than those who desire it would require optimizing the variables that contribute to desirability. 4. The potential result is desirable, ie proximity to jobs or cultural center, low crime, low cost of living, etc. A number of variables contribute to each of these, and those would require optimization as well. 4a. There will be a point of diminishing returns, where builders will exit a market when there are not enough buyers at high enough prices to make a profit. As soon as there is a hint of profit, the vultures will appear. 5. In order to prevent real estate speculation, we could impose a few laws: first, make lending at a profit illegal for all non productive enterprises; second, levy a land value tax that hurts enough that it makes owning non productive commercial property untenable to own; third, allow only individuals to own residential real estate, ie, eliminate the rental market entirely and levy use taxes for vacant homes (your real estate must be your home of record and must be your residence for some minimum percentage of time every year). This would destroy the real estate market entirely, and I don't think that would be a bad thing.

by all2 2y ago

As soon as you announce a new subway station the vultures descend and prices will ratchet up as speculators by land and sit in it, waiting for the hither bidder.

bostonvaulter2 2y ago

One part of the answer to that is a land value tax. That way the “vultures” won’t be able to simply sit on the property waiting for it to appreciate before selling it.

thanksgiving 2y ago

That means the demand is very high and we need to build even more subway stations until the “vultures” can’t arbitrage the market anymore.

lotsofpulp 2y ago
Crazy that you are being downvoted for applying the principles of supply and demand.
all2 2y ago
If I think through this; 1. Price varies based on desirability of a location. 2. Desirability varies based on many factors, including proximity to a city center or major business concerns, cost of living, crime rate, etc. 3. To optimize desirability until there is more desirable space than those who desire it would require optimizing the variables that contribute to desirability. 4. The potential result is desirable, ie proximity to jobs or cultural center, low crime, low cost of living, etc. A number of variables contribute to each of these, and those would require optimization as well. 4a. There will be a point of diminishing returns, where builders will exit a market when there are not enough buyers at high enough prices to make a profit. As soon as there is a hint of profit, the vultures will appear. 5. In order to prevent real estate speculation, we could impose a few laws: first, make lending at a profit illegal for all non productive enterprises; second, levy a land value tax that hurts enough that it makes owning non productive commercial property untenable to own; third, allow only individuals to own residential real estate, ie, eliminate the rental market entirely and levy use taxes for vacant homes (your real estate must be your home of record and must be your residence for some minimum percentage of time every year). This would destroy the real estate market entirely, and I don't think that would be a bad thing.