Sunday, November 28, 2010

Owning Property in Major US Cities Is a Liability

I've said it before, and you people didn't listen to me, but owning property in major US cities is a liability. Not only because of perpetually dropping housing prices, but the risk just isn't worth it. You have to deal with leftist regulations, the threat you'll be forced to abide by progressively increasing municipal environmental regulations (recycling, insulation, heating requirements, etc), and as capital and labor flights out of the city to the burbs, you will face a Detroit like environment. But the biggest risk, property taxes.

You don't think AFSCME and SEIU at the local government shops are going to take pay cuts do you?

And you don't think good liberals in major cities are going to vote in any kind of republicans or politicians that will cut spending, do you?

Ergo you can expect your property taxes to go up regardless of the economy and the value of your property, which will directly force your property value down further because the net cash flow it could feasible generate has gone down.

Smart people will make moves like this.


Hot Sam said...

I plan on selling my house to an SEIU employee for a big gain.

Bigger fool theory of profit.

Anonymous said...

I agree, Cap, but it's not just the major US cities, mid-sized cities like Rochester (MN) are also rapidly moving toward one-party (Democratic/socialist) rule.

As a result, you're seeing many of the same things happening in Rochester as has in Minneapolis - increasing regulation, taxes continuously going up, while property values decline. Crime going up rapidly as thugs and criminal move in from elsewhere (e.g. Chicago).

Rochester isn't yet like Minneapolis, but it is rapidly heading that direction.

And lest you think jack-booted thugs as bureaucrats are limited to large cities, my county has an health dept "nazi" that is going around "inspecting" septic systems and forcing rural residents to replace them - even if they are working properly.

As a result we cannot build a even doghouse without having to replace our septic system, yet the design the county mandates has proven to not work reliably in our heavy clay soil.

This same moron ordered all the churches in the county to cease having banquets, suppers and potlucks until the kitchens were upgraded to commercial standards, inspected and approved by the county health dept. Rural churches do not have the multiple thousands of dollars to upgrade everything to stainless steel appliances, sinks, counters and tables.

This is what happens when DFL dominated government thinks it knows better.

Anonymous said...

From a landlord's perspective, the same general economics apply to rental property. This ensures that large parts of major American cities will degenerate to slums.

Anonymous said...

Unrelated Cap, but what do you think of this video:!

- Breeze

Captain Capitalism said...

Hey Breeze,

Yeah, that can happen. Most of it already has, HAR!