> "It shouldn’t take six years for any city to agree to give itself permission to build the sort of homes that every city once allowed." This is IMO the big thing here. Cities used to allow this kind of construction. Our auto-friendly culture and the desire of landowners to keep poor people off their block has led to increasingly draconian restrictions on private property use. I understand regulations around keeping…
- Purchase old home or lot.
- Tear down old structure.
- Build new 4-plex or 6-plex.
- Sell/Rent 4-6 units on a plot.
Example: "ABC" owns rancher on a single plot. Rents out rancher for $4000/mo. Current revenue is $48000/yr. "ABC" turns rancher into modern 6-plex on the same plot. Rents out each of the 6 units for $2000/mo. New revenue is $144000/yr.
Of course, capital required to build a new structure will erode returns for initial years, but as long as the demand to live in Portland is still high, it seems like a more profitable strategy longterm?
Unless I am totally off-base with these assumptions.