Rentvesting kills the economy

[Furball808]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

Now look at rich countries. What do they have? They have invested in research & development which is why they have the leading brands all over the world. Korea has Samsung. Germany has Mercedez-Benz. Japan has Toyota. And many more. The companies in which these are made from generate jobs and it allows the economy to circulate well. Not only does these industries provide employment they also provide exports.

If the government or the collective population only focuses on real estate, there's little to no productivity in the economy. I am not saying real estate should not be on your lists of investment option of course balance must be well maintained however people must stop being so risk-averse because it is what slows down the economy.

[Helena Yu]

Construction workers should be excluded, their demands are high because when someone have problem in their home, they would get called and fix it.

It's both engineers and architects who might not able to get client for every month, but everything are depends on them. Engineers can work as a supervisor or surveyor while architects can work as a freelancer.

Also, the main problem why other countries aren't focus on Research and Development is due to lack of smart people in their country and they don't have much money to hire expatriate.

[Die_empty]

If the government or the collective population only focuses on real estate, there's little to no productivity in the economy. I am not saying real estate should not be on your lists of investment option of course balance must be well maintained however people must stop being so risk-averse because it is what slows down the economy.

A country without a diversified economy will face problems. The Chinese economy is still suffering from the real estate crisis to date. The government and other investors should discover and develop other areas that will boost economic development. The Chinese economy would have collapsed because of the real estate crisis if not for the country's diversified economy.

Also, the main problem why other countries aren't focus on Research and Development is due to lack of smart people in their country and they don't have much money to hire expatriate.

Human brains are the same regardless of the colour of skin or geographical location.  Every country has smart people, the difference is education. If you expose people to the same level of education, they will acquire similar skills. Why do citizens of poor countries migrate to rich countries and become more productive? It's because of exposure to quality education.

Brands like Samsung, Mercedes-Benz, Toyota, and others are global brands, not because the people of the country are smarter. These companies are supported by the government. Government is a major player in the field of research and development. Universities should receive enough funding for research which will be beneficial to industries.

[viljy]

In general, it is as OP writes. Capital that is placed in real estate, especially residential real estate, is not productive capital. The profit derived from the rental of such real estate is net rent. Since this capital does not create jobs and does not create new value production, rental profits are generated from the redistribution of profits from productive capital (for example, a worker gives part of his wages for rental housing). Thus, rentiers in any economy are a burden on productive capital. But in fact, rentiers are nothing compared to financial capital (banks), which simply sucks out almost all profits like a vacuum cleaner from manufacturers.

[Gozie51]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

This part interest me. We should understand that it is not all jobs that will be manufacturing. For real estate investment or business, there is a part of manufacturing and construction there. For building a house or other construction work, you need engineers of different types, you need architect, surveyor, labourers etc , and at that point they feed from such project until it is erected. Now, at the point that it is erected it becomes a servicing system for renters and at the same time, a construction or maintenance site because maintenance will still go on there for repairs at the long run. The chain of employment is still there.

However, I understand what op is saying, there are some countries that have the capacity for world class production and brand marketable to the world which generate huge income for there economy while others can only go within servicing and repairs, it is unfortunate. The funny thing is that those who produce raw materials for such production are not very economically buoyant like those who produce the finished products.

[ovcijisir]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

Now look at rich countries. What do they have? They have invested in research & development which is why they have the leading brands all over the world. Korea has Samsung. Germany has Mercedez-Benz. Japan has Toyota. And many more. The companies in which these are made from generate jobs and it allows the economy to circulate well. Not only does these industries provide employment they also provide exports.

If the government or the collective population only focuses on real estate, there's little to no productivity in the economy. I am not saying real estate should not be on your lists of investment option of course balance must be well maintained however people must stop being so risk-averse because it is what slows down the economy.

Op, here you are comparing two different industries. Buildings have lifespan of minimum 50 years, and they can be used for more than hundred years. Cars on the other hand have lifespan of up to 20 years,and require regular servicing for at least once per year.
I don't think this can be compared that easily. Also to add real eatate also generate jobs - electricians, plumbers, hvac technicians they all are doing in real estate industry.

Second, basically you are saying that if something is built with high quality it will kill the economy. Basically the best for economy would be to build low quality real estate with short lifespan? Maybe that would be good for "economy" but not for the people.

[Spaceman1000$]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

Now look at rich countries. What do they have? They have invested in research & development which is why they have the leading brands all over the world. Korea has Samsung. Germany has Mercedez-Benz. Japan has Toyota. And many more. The companies in which these are made from generate jobs and it allows the economy to circulate well. Not only does these industries provide employment they also provide exports.

If the government or the collective population only focuses on real estate, there's little to no productivity in the economy. I am not saying real estate should not be on your lists of investment option of course balance must be well maintained however people must stop being so risk-averse because it is what slows down the economy.

I'm trying to relate your topic and the body of your text,  from what I can understand your talking about real estate and how other enterprises can be built to sustain an economy.  Construction companies who are mostly involved in real estate building, do this on contract basis, and they are paid handsomely, go round and ask those engineers that are mostly involved in construction work, you will understand what am saying.

In most economy of the world, a lot of people are not only fixated on real estate development alone, there are other sectors of the economy that is being explored, and that is why in most cases government will always seek for diversification of investment, this diversification is not only done by government, private individuals go on to build brands on their own that is well known globally.

[passwordnow]

There's the Evergrande fiasco in China that has burst the bubble in China's real estate economy. While it's a good thought about countries shouldn't be focusing in real estate. But you know that they're into it because it's also a limited asset that can't be for most of their people. The land properties are growing each year and that's why, it can't be stopped when there are people and companies that are focusing into that. It also generates passive income for the owners who rents their properties and that's why it's a good source of income and cash flow. I guess that many bitcoin investors or the crypto profiteers have that plan of investing into real estate.

[Lanatsa]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

This part interest me. We should understand that it is not all jobs that will be manufacturing. For real estate investment or business, there is a part of manufacturing and construction there. For building a house or other construction work, you need engineers of different types, you need architect, surveyor, labourers etc , and at that point they feed from such project until it is erected. Now, at the point that it is erected it becomes a servicing system for renters and at the same time, a construction or maintenance site because maintenance will still go on there for repairs at the long run. The chain of employment is still there.

However, I understand what op is saying, there are some countries that have the capacity for world class production and brand marketable to the world which generate huge income for there economy while others can only go within servicing and repairs, it is unfortunate. The funny thing is that those who produce raw materials for such production are not very economically buoyant like those who produce the finished products.

Real estate is one of those things that feels both productive and stagnant at the same time when its being built it’s like a whole machine running there are engineers masons suppliers drivers everyone getting paid but once the work is done it slows down and only a few people keep benefiting from it like the owner or the small team doing maintenance.

But that doesn’t mean it completely stops giving back because buildings still need people to manage them to fix things clean or renovate from time to time and even if its not creating big jobs like manufacturing it’s still giving stability and some small steady work to a few people. The big issue though is what you said some countries only stop at building and renting while others take it further into producing materials furniture technology and that’s what brings real money the raw material countries do the hard work but don’t make as much because they don’t own the final product that’s why development isn’t just about building things but about controlling what happens after the building is done.

[Rruchi man]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

Some real estate investment is still providing jobs for some people.

In my country, for instance, there has been a massive surge in interest in building short-let apartments that people lease, and it is much more preferred to getting a hotel room. Because of this new investment, getting a property you could just rent for you alone or with your family is now not so available because they are fewer. The available ones are too expensive for so many people doing average jobs to afford.

Those short-let apartments provide jobs for cleaners, security, and people in the maintenance business, that is, electricians and plumbers, because these short-let apartments are always booked out.

Then for those that have invested properly into real estate and built well-developed estates with facilities like a pharmacy, a recreational center, a spa, and other kinds of facilities that create jobs, they will still be creating jobs. If you imagine a huge estate as this with the number of jobs it has created and compare it to the number of jobs some small-scale industry that could have been established there also will create, it may be around the same figure, or the difference not so much.   

[Alpha Marine]

So, how is that killing the economy? it even does the opposite by creating jobs. At all times, there is a building construction going on. It's not like once a building has been completed, then there are no other constructions going on. Those engineers, architects and construction workers are not signed to life on one project. They don't necessarily become unemployed after the building is completed. There are construction companies, and these engineers and architects work for the construction company. They simply move on to another project. EVen the companies you mentioned like Mecedes and the rest will require the services of construction companies to set up their structures.

Where it becomes a problem is when the economy is failing, and there is no longer money in the economy for people to finance their project, and this is not caused by other real estate projects; it's caused by a failing economy. So I don't see how you can look at all the factors that ruin an economy and point to just people wanting to own or rent real estate as what kills the economy.

[pawanjain]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

Now look at rich countries. What do they have? They have invested in research & development which is why they have the leading brands all over the world. Korea has Samsung. Germany has Mercedez-Benz. Japan has Toyota. And many more. The companies in which these are made from generate jobs and it allows the economy to circulate well. Not only does these industries provide employment they also provide exports.

If the government or the collective population only focuses on real estate, there's little to no productivity in the economy. I am not saying real estate should not be on your lists of investment option of course balance must be well maintained however people must stop being so risk-averse because it is what slows down the economy.

To be honest, its not as if once the building is built the work is completed. It also required active maintenance.
Then comes resale and then destruction and reconstructing the building as well.
When this happens at large scale, we come to know that construction and real estate is a very big thing in itself.

[Bluedrem]

Those who want to become rich day by day do not depend only on the money they receive in rent. To be honest, those who do not want to improve their lives and just want to live by eating may have made such a plan. But a real developer never limits his money to one place, they want to increase it as it grows, in which case they try to present their investment strategy differently. As you said, Samsung Mercedes, who have already earned a lot of money, but if they want, they can now manage their lives easily by investing that money in different real estates, but instead of doing that, they are constantly trying to earn more money by using their money in research and other fields, that is why they have transformed from rich to rich today. To be honest, if a person has money, they should not save it in a specific place of income, but should use it widely so that one billion dollars can be converted into at least 100 billion dollars.

[imamusma]

I think everything depends on the opportunities available. Sometimes those who choose to keep investing in real estate, as well as those involved in its development, feel that they gain better benefits in that field. When you build housing or apartments to rent out, you will need maintenance. So even if indirectly, it still creates new job opportunities. The cash flow may feel slower compared to other types of investments, but as long as it still generates profit, I think there is nothing wrong with giving it a try.

[Kagaru]

In my opinion, the matter is not that simple. Suppose a building is built, during the construction, no jobs were created but a whole chain of cement factories, steel, electrical products, furniture, interior design was associated with it. Even after the building is erected, some economic activities continue. Maintenance rental management, employees in the case of a business and its supply chain in the case of a store. So it is not right to call real estate completely inactive.

Then we also need to think about why people go into real estate more. Because in other investment sectors our country's infrastructure or policies are not yet that strong, not everyone can create a startup or invest in a high risk industry. So many people go into work where at least the wealth remains and provides a sense of security, this is not wrong.

[mrust_mobile]

Developed countries already put some serious taxes on residential real estate ownership as far as I am aware. If you want to make money from real estate rents, commercial is the way to go. Leave residential real estate alone. Even if you can make some money today, it is only a matter of time before the governments heavily tax your income. Commercial real estate is fine though. Nobody can do nothing about it. It is as safe as it gets.

I have even heard that in Spain there is a law called "Ocupa"

https://en.wikipedia.org/wiki/Squatting_in_Spain

Squatting in Spain refers to the occupation of unused or derelict buildings or land without the permission of the owner. In Francoist Spain migrant workers lived in slums on the periphery of cities. During the Spanish transition to democracy, residential squatting occurred in Spanish cities such as Barcelona, Bilbao, Madrid, Valencia and Zaragoza. From the 1980s onwards a new generation of squatters set up self-managed social centres which hosted events and campaigns. The 1995 Criminal Code among other things criminalised squatting, but failed to stop it. Social centres exist across the country and in Barcelona and Madrid in particular. In the Basque Country they are known as gaztetxes [eu].

This is some seriously fucked up shit over there. If you want to make money from residential real estate, you are looking for trouble.

[BlackHatCoiner]

This whole argument is classic Keynesian logic where symptom is seen as the "cause of the problem". Fiat money is what turns the entire economy into a nation of panicked landlords.

People aren't buying real estate because they "lack vision" or because they're "risk-averse." They're doing it, because holding fiat currency is financial suicide. The government and the central banking cartel openly guarantee your savings will bleed value every single year. Of course people will rush into property. It's the least uncertain thing to bleed value, and which the banking cartel promotes, as it enables fiat mining through loans.

[Marvelockg]

Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

This is just a one sided narrative when you look at it real good. do you know that there is still house crises in terms of the available houses not being sufficient to meet the needs of the large population that are looking for house to occupy? with the current involvement in the real estate niche, there is still the issue of house deficit which literally means that real estate performs greater function that short term generation of jobs for the populace.

are you trying to say that because real after erecting building that the service of engineers wont be required that people should stop building houses?  every industry is equally needed in the society as the other and it takes multiple of industries to build a strong economy.

[Creeper0]

There should be diversified investments for the continuous rotation of the economic wheel of a country. It is not possible to develop a country with production alone or to create sufficient employment. We get 10%-12% employment on a global average from real estate, which plays a role in economic development to some extent. The main strength of a country should definitely be on production and production is basically the main force behind the development of a country. But real estate should not be neglected, we definitely do not want to be dependent on any other country for construction work. Maybe there is not much permanent employment here, but we get regular temporary employment from this sector. Even in this sector there are people of various professions, such as electricians, construction workers, land and flat sellers, transportation sector etc.

[Sticky Bomb]

Rental Property Investment or can be called rentvesting is a type of investment wherein you invest in real estate whether to live on it, rent it out, or build business on it. A lot of people dream of owning lands or rental property but this might actually is what kills the economy. Imagine the type of jobs that real estate generate. There are engineers, architects and construction workers. But once the building gets built, there will be no more jobs from that real estate or there's less.

This is a lie, when they're done with a house, they move to the next one. Actually real estate workers are in low supply compared to demand as at now. Most people have embraced digitalization leaving the physical world for only a few. When I upgraded my office space, I had to book down an engineer with his workers so my job can be done on a specific day, if I had waited for the very day before seeking them, my work would've been postponed.

Now look at rich countries. What do they have? They have invested in research & development which is why they have the leading brands all over the world. Korea has Samsung. Germany has Mercedez-Benz. Japan has Toyota. And many more. The companies in which these are made from generate jobs and it allows the economy to circulate well. Not only does these industries provide employment they also provide exports.

It's good to note that all these companies mentioned here need real estate services to get their office space erected, renovated and even maintained. Their warehouses are still products of real estate activities.