Financialized ownership of housing and land degrades living conditions and inflates asset prices

Evidence

Along with the financialization of everyday life, financial interest now extends to areas traditionally considered outside the market economy. For example, financial markets and actors have become central to the production of urban spaces. The proliferation of predatory equity (i.e., private equity’s extensive investment in affordable rental housing) is shaping urban living conditions. The higher profit expectation of predatory equity led to aggressive efforts to increase tenant turnover rates (through harassing existing residents) and to reduce maintenance expenditures, causing a rapid physical deterioration of living conditions of underprivileged urban populations (Fields 2013). Another example is increasing ownership of timberland and farmland by institutional investors. Unlike corporate landowners who directly used the land for industrial production, financial landowners treat land as a financial asset that produces a short-term return on investment through asset price appreciation. Gunnoe (2014) reports that this leads to the similar trouble with any commodity embraced by the financial market: ungrounded price rises (bubbles) in farmland and timberland. — Gerald F. Davis & Suntae Kim, Financialization of the Economy, 87

Categorization

• XREF: Connects to the ADDENDUM series on infrastructure and land ownership — this grounds ‘trees as infrastructure’ in the financialization lens: timberland as a pure financial asset vs. productive use. — connects to: Housing asset ownership now structures class and inequality more than occupation does. — Paul Langley, Assets and Assetization in…, 39; The mortgage interest deduction raises home prices and fails to encourage homeownership — Dorothy A. Brown, The Whiteness of Wealth: How the Tax…, 186; Homebuyers keep buying risky homes because regulation costs eat their housing budget — Adam Rome, The Bulldozer in the Countryside:…, 1084 (+1 more)
• ADDENDUM: Directly supports the ‘Grafting & Growth’ article’s theme of underused infrastructure: institutional ownership of timberland as asset-price speculation rather than productive forestry flips that article’s living-tree worldbuilding into its dystopian inverse.

Related

• Housing asset ownership now structures class and inequality more than occupation does. (similarity 0.80)

Broader Connections

• Housing asset ownership now structures class and inequality more than occupation does. #expands (0.85) — Paul Langley, Assets and Assetization in…, 39
• The mortgage interest deduction raises home prices and fails to encourage homeownership #corroborates (0.75) — Dorothy A. Brown, The Whiteness of Wealth, 186