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Re-Migration Will Increase House Prices & Rentals and Trigger an Economic Boom



Re-Migration Will Increase House Prices & Rentals With an Economic Boom. This is A Good Thing. 

We appreciate very much what you are doing to save the nation. And it's essential the administration understands this - which it may well do already, so that it is ready for the significant effects of this boom well ahead of the game. Which I forecast will be bigger than the tariff so far, also an excellent policy.

Before we move on, we should consider this is a good thing economically(in spite of the political fabrications that will surely follow it). 

This post is not trying to say re-migration is a good or bad thing in and of itself. It is saying that economically there will be a boom if it happens, not a regression.

Now you understand my motives for posting this let us move on to the technical detail:

The assumption that large scale re-migration will reduce rents and house prices is a technical mistake economically. This is not how real estate prices and rentals work exactly. Though I fully understand your purpose to market it like this and I have no problem with that.

By removing so-called bad actors from a location, at scale, means the value of that location will certainly rise. 

This offsets the effect on prices of the new supply of rentals that are now there.  

The net effect is to increase the rents and selling prices, overall. 

Exchanges of real estate function differently to the exchange of goods and services. Because the market knows to make the most out of it, it must speculate on real estate as an asset. 

It does this by bidding up expected future higher prices due to the present new improvements. People are not paying what a location is worth today as they do with goods and services, but what they expect it to be worth way into the future. 

And this speculative effect always outruns the simple supply and demand mechanics.

It's important to understand this as an administration. If only so that you're ready for the economic boom which is likely to follow, ahead of the game. 

I'm sure the President would be delighted to hear this being a real estate expert. I am no expert politically so I do not know how it fits into his program. 

The key point is that rising rents are a clear signal a nation is improving - the best signal of all. And declining rents are a signal the nation is in decline generally. You do not want to signal that rents are falling, it is a mistake politically. There are 130 million home owners in America each with two votes in each home on average. 

I hope you understand. By all means call for clarifications. 

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