Raise the Hammer

beesplease, in some ways it's a self fulfilling prophecy. If no one believes that downtown Hamilton is a good place to invest, including the city, why would we expect people who don't live here to do so?

What could be a better signal to people looking to invest in Hamilton, then a government that is committed to increasing, or at least maintaining, the value of people's real estate holdings. For example, if you knew that downtown Hamilton floor space would be free from over supply due to government intervention, how could an investor not love this?

Investors want security and they will trade it off for return. That's why they buy 10 year GIC's returning 2.3%. When risk is introduced, they demand a higher return. In this sense, having the city buy back property when prices fall, or even just promise to, will increase the amount of money they are willing to invest.

As it stands today, the city is telling current property owners that their goal is to increase the supply of floor space. If you own a building that is barely covering expenses, does that make you want to invest more to fix it up, knowing that rents will fall in the near future?

BH, "What qualifies municipal politicians to be land speculators?"

How difficult is it to buy vacant or low vacancy real estate? Remember the goal is not really to try and flip properties, it's to manage supply so that investors can make money over the long term. One of the primary reasons why Hamilton's downtown is as run down as it is, is because investors have lost confidence. By actively managing the supply of land/floor space, the City of Hamilton would bring this back.

..."How do the people of Hamilton benefit from having their money tied up in underused downtown real estate? "

Just telling the world that it plans to reduce the excess supply of floor space would get the ball rolling. If people knew that the government was going to start controlling prices by reducing our current excess supply, sellers would immediately raise their ask price for their own property.

That is what has been lost here in Hamilton, the sense of security that government is supposed to provide. When the government can provide some common sense to the markets, taking away the excesses which tend to result from fear and greed, the result is steady, but still healthy growth.