Economic research reported by international news outlets, all suggest that apartments located in major cities are well beyond the financial reach of persons working in those cities, resulting in long daily commutes, expanding city limits, growing ghettos surrounding the city centres and, as a further result, opportunities for those historical real estate owners to profit from the development of rental accommodations.
When an average office city worker has to travel for over an hour, it is time to relocate that operation and the answer always seems to be, just outside the city limits, naturally moving operations, converting slumps into industrial and commercial parks with middle class housing units.
The opportunity is for the previous owners in that location to sell or develop.
The city centre, traditionally marked by high rise buildings, architecturally designed to attract and keep global corporate headquarters, financial operations with high-end trade, entertainment and penthouse living spaces, is the first to react to economic movements.
Noting that, governments, which may own buildings in the city centre, may not be able to afford operations in that location, choosing to lease, to more profitable enterprises as economic growth occurs and in economic downturns host only special events as not to have the city centre seen as abandoned.
A few minutes from the city centre, by highway or other mode of transport, are economic conditions generally termed middle-class, consisting of some low cost housing that over a generation or two developed into a community; religious, educational, sporting and security facilities, which middle income earners can just barely afford.
Limited availability of such family units must escalate values, hence, driving further development and renovations into single and two bedrooms apartments to meet market demands. City type development is predicted to follow in the not too distance future, as roads, electrical and electronic networks expand, as jobs and companies seeking out more competitive economic rates, and as a skilled population grows.
Investment in ghettos, high crime areas, which has the potential to eventually evolve into middle-class communities, must be government led; primarily by police and special security forces, in association with religious, education and health interventions, all playing a part in building an investment climate.
Developing housing for low-income earners should be in association with or in close proximity to government funded housing projects.
Noting that, all values and estimates would instantly increase upon an announcement of the government project.
The opportunity is to purchase lands, next to a government or large developer-funded low income earners housing project, before it is made public and building more than one middle income earners housing unit, with the risks of breaks in rental agreements, the low income earner housing project being postponed for a lengthy time or cancelled, leaving a greater exposure to crime.
Another opportunity is based on having legal rights to land in a middle-class community and building more than one middle income earners apartment, with the risks of breaks in rental agreements.
And yet another opportunity is to purchase more than one unit in a city complex with the risks of getting a mortgage based on rental income and breaks in long lease contracts.
Terrance A. Jennings