@WayneFougere @fabulavancouver Might be fine, too. Gov’t debt just flamingly cheap now, might think of rentals as “infrastructure.”
— Tom Davidoff (@TomDavidoff) September 5, 2016
It’s hard to calculate market rents, but it’s easier to define below market rents: zero dollar. So we can build to accommodate as many as we can afford? Should there be user fees?
Let’s think of infrastructure as something like bridge to nowhere, an extreme example of “build to accommodate”. Any city has a price tag, and of course we can’t expect this kind of infrastructure to be free when the majority housing in the city isn’t free. Also, the economy of the city add value to housing, unless the city is a destination of a bridge to nowhere.
So, how to set below market rents, to make them affordable? How about cap rate = 2%?