How Land Became the World's Favorite-and Most Destructive-Asset

"In the priciest U.S. cities, three-quarters of the value of residential neighborhoods is just dirt. The aftermath of January's Los Angeles fires shows one consequence of this bizarre situation, since victims' insurance payouts (equivalent to the structure cost) are so much less than their mortgages (which include the precious land). Starting over elsewhere becomes a financially ruinous proposition."

"Land is the subject of journalist Mike Bird's smart and stimulating new book The Land Trap: A New History of the World's Oldest Asset. The subtitle does not accurately reflect the book's scope, which is short on the first 5,000 years of human history and concerned primarily with the tricky choices that contemporary societies face in the distribution, taxation, and regulation of property. But that's for the best."

Housing costs have risen far faster than incomes in many U.S. regions, with typical home prices exceeding five times median household income and ratios reaching double digits in South Florida, coastal California, and Hawaii. Much of residential value in expensive cities reflects land rather than structures, sometimes three-quarters of neighborhood value. Insurance payouts often cover only structure costs while mortgages include land value, making recovery after disasters financially ruinous. Builders confront tariffs, high interest rates, and labor enforcement challenges. Governments face conflicting pressures to expand homeownership while protecting incumbent owners through distribution, taxation, and regulation of property.

Read at Slate Magazine