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You think if there were modern highrises in Menlo Park a tiny 2BR shack next door would still sell for $2M? It’s a supply and demand issue, nothing more.
by paxys 8mo ago
You think if there were modern highrises in Menlo Park a tiny 2BR shack next door would still sell for $2M? It’s a supply and demand issue, nothing more.
- rconti 8mo agoA tiny 2BDR shack next door that is worth $3M because of the 6000sqft lot it sits on _absolutely_ goes up in value when density increases.
- some_random 8mo agoIt's not worth $3M because of the lot it sits on.
- kevstev 8mo agoWhat is your mental model for this then? If the "2BR shack" can be built from scratch for 300k, and the value for the lot + shack is $3M, then the land value is $2.7M. Most expensive real estate is land value, not actual structure value.
- some_random 8mo agoI see what you're saying, my point is that the principle thing driving it's value isn't the land nor the shack, it's the regulatory framework of the area.
- cucumber3732842 8mo agoYes, it would go way, way, way up because if there is a high rise next door someone wants to knock down the shack and put up another high rise, a commercial building, etc.