4 ms·
When a good's supply is constrained, it becomes a store of value. See: gold. Strangely enough, if housing got built in response to price increases, there would
by BobbyJo 4mo ago
When a good's supply is constrained, it becomes a store of value. See: gold.
Strangely enough, if housing got built in response to price increases, there would likely be less unused housing, because it would be seen less as a way to store capital.
- roenxi 4mo ago> When a good's supply is constrained, it becomes a store of value. See: gold. That doesn't make sense as stated, because every physical commodity is supply-constrained to some extent, even and especially the ones that are extremely bad stores of value. Picking on Fermium (it has a nice atomic number) - Fermium is supply constrained and it makes a horrible store of value because it rapidly morphs into something else. Gold is a well-liked store of value because it is absurdly stable (about as close as we can practically get to indestructible) and roughly the easiest to physically store out of all the durable candidates.
- uniqueusername7 4mo agoWhile houses depreciate, both they and the ground they are built on tend to have a very low chance of experiencing spontaneous transmutation, so I'm not sure how good of an example fermium is.
- microgpt 4mo agoWhat if we added some kind of artificial spontaneous transmutation to housing? Maybe (this is really dumb but bear with me) every year 200 randomly chosen houses become the property of whoever is living in them at a random moment. What would happen?
- pydry 4mo agoWhen property taxes are higher housing is built more densely. This is because the store of value quickly becomes a millstone around the owner's neck if it isnt being used efficiently. That's a feature if you want a healthy city and a bug if you're one of the ultra wealthy. The UK is a bit like San Francisco in this respect. There are no property taxes, just something called a council tax (which is basically a poll tax) and "stamp duty" which is levied only on property transactions. The latter is particularly toxic because it actively encourages property hoarding. This is why London is an alpha world+ city which can't build up to save its life.
- dripdry45 4mo agoimo The big key here is zoning. I live in a city where they actively work against people who want to build out their properties and create more density. The property taxes are sky high, but the city actively works against your affording them. It’s terrible.
- pydry 4mo agoHow high is sky high?
- Schiendelman 4mo agoThe real answer is rough: By giving the public any say at all, they push and push until they have restricted growth. It's far better for everyone to not ask anyone but the owner of the property how tall they want to build.
- microgpt 4mo agoCompetition was supposed to save this though. You have to use it effectively otherwise your neighboring competitor takes all your customers.