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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (21982)	7/6/2004 5:03:01 PM
From: Rutgers	Read Replies (1) \| Respond to of 306849

Why is the real estate in downtown Los Angeles not far more costly than similar lots in downtown Manhattan? By Manhattan, are you referring to NYC, aka, the No. 1 city in the world? You know, the one that d/n sleep, has Broadway, Lincoln Ctr, Central Park, the Statue of Liberty, Museums for everything, Wall Street, Columbia, NYU, SOHO, WFC, Madison Square Garden, Radio City, Carnegie Hall, Yankees, just to name a few? The weather is certainly far superior in Los Angeles. While i's all relative, I c/n disagree more. Like some others, I love having four seasons. LA has approx. one season, right? What gives an undesirable and cheap piece of real estate cache and value? Is it scarcity? Location, location, location. <g>

To: Elroy Jetson who wrote (21982)	7/7/2004 9:59:45 AM
From: GraceZ	Respond to of 306849

Real estate doesn't need to be "scarce" for prices to rise. For prices to rise all you need to have is marginal demand to run slightly ahead of marginal supply AND the perception that prices will be higher in the future. In my area, regulation has severely limited the amount of land for greenfield development. For every application for say 170 houses the regulators will limit the development to a quarter of that amount, mandating large blocks of "open" and unused land for each house built. These are regulations designed to limit environmental impact as well as curb growth that strains the existing services, but it has the effect of limiting supply in a desirable area and this drives up prices. In most of the desirable neighborhoods here in Maryland these anti-growth regulations have been put in place. I'm in a water shed area and that has special restrictions. The most desirable land in Central Maryland is near water and that has wetlands restrictions. The most expensive houses are near the water because this is where supply has been limited the most. That said, many of the laws and regulations in my area have been loosened in recent years as the demand for new housing has been strong enough to get ordinary people complaining to their lawmakers about the growth limits. Now there is a "down zoning" movement where I live and they are duking it out with those who have raw land they want to sell to developers or develop themselves. This has resulted in a flood of small landowners applying for zoning variations in order to subdivide their properties before the down zoning regulation which is sure to pass.