A Silicon Valley Bungalow Costs $1Million Plus
|July 24, 2013||Posted by Staff under Economic Principles, News|
Because it’s Round the Corner from Google’s HQ
David Ricardo was right: land, or location, does gobble up the increase in wealth. This 2013 excerpt is from the Daily Mail, June 18.
by Damien Gayle
With just two bedrooms and a single bathroom spread over its modest 960 sq/ft living space, this unprepossessing 70-year-old bungalow in Mountain View, California, is on the market for a wallet-busting $1.1million (£700,000).
The reason? It’s less than ten minutes’ drive from the headquarters of online search and advertising giant Google.
Just an average middle-class American suburb… The area’s property prices have risen in line with tech stocks.
What potential buyers will be paying for is the privilege of living in Mountain View.
Google is reputed to lead the pack in doling out the big bucks to its software engineers and designers, with even interns earning a massive $6,000 a month.
High prices aren’t a problem if you’re a well-to-do software engineer, but for the rest of humanity, you’re suddenly priced out.
And the situation is only likely to get more difficult. Zillow predicts that Mountain View house prices are likely to rise a further 7 per cent next year.
JJS: How can everyone benefit from the rise in location values? Simple. Recover them with land dues and share them with residential dividends.