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by willis936 887 days ago
A lot of these zoning changes lower the already low barrier for multinationals to build, but does nothing for actual families. I'm presently surrounded by hundreds of empty units priced out of reach because these companies are illegally colluding to fix the price. They may claim ignorance and try to launder responsibility through a series of tech products, but at the end of the day the rent is high where I am because of price fixing.
1 comments
robertlagrant 887 days ago
Sorry I don't understand - why would they be selling units, but also deliberately pricing them too high?
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squokko 887 days ago
It has to do with the company's balance sheet - their list of assets which they use to borrow money.

If they have 1000 units that they say are worth $1 million each, they can borrow from banks as if they are sitting on $1 billion of assets.

If they sell one of those units at $500K, they now look like they have $500 million, which not only impedes their future borrowing but can trigger obligations to their current lenders.

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robertlagrant 886 days ago
It would be surprising if they can just not sell things because they're too expensive, and then borrow based on that too expensive price. Why not just have a single one and price it at $1bn?
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yccs27 887 days ago
To get more money? https://en.wikipedia.org/wiki/Price_fixing
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robertlagrant 887 days ago
But they're standing empty. If they're empty, they're not getting any money.
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willis936 885 days ago
They're maximizing revenue by operating at a lower quantity and higher cost. This is microeconomics 101. People get driven out of urban areas where there are good paying jobs. In an ideal market this should be undercut by competition. In reality all available housing in urban areas are owned by large corporations all using the same price-setting backend. This is an illegal trust supercharged by the internet and globalization. It's an international Pottersville rapidly sprung from nowhere. So no, big corporations don't need more government handouts to do more of the same. Incentives for not-profit-driven entities (such as humans seeking secure housing) should be given.

https://www.propublica.org/article/doj-backs-tenants-price-f...

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