Politics, Power, and Profit: How Real Estate Runs the World
The real estate industry is one of the world’s richest and most powerful forces. “Global real estate is now worth $217 trillion, 36 times the value of all the gold ever mined,” writes Samuel Stein — a doctoral candidate in geography at The Graduate Center, CUNY — in his new book, Capital City: Gentrification and the Real Estate State. And the private equity firm Blackstone is “now the world’s largest landlord.”
But that doesn’t translate into affordable housing – quite the opposite. “Money around the world has pooled into land and buildings and apartments, not for the purpose of living in necessarily, but for the purpose of making a profit,” Stein told The Thought Project podcast.
In the last three years, 70,000 housing units were built in New York City, but another 60,000 (some new, some existing) remain unoccupied, having been bought as investments. Meanwhile, home ownership is at a 50-year low in the U.S, while rents have more than doubled in the last 20 years. Yet wages remain stagnant. “There is not a single county in the country where a full-time minimum wage worker can afford the average two-bedroom apartment,” Stein writes. No wonder employment is no guarantee against homelessness.
That a real estate developer, Donald Trump, became U.S. president is another manifestation of “the rise of the real estate state, a political formation in which real estate capital has inordinate influence over the shape of our cities, the parameters of our politics and the lives we lead,” he writes.
Stein says good city planning is the key to creating decent housing and livable communities without the displacement that accompanies gentrification. But governments, focused on increasing land values, too often allow real estate interests to control city planning.
Stein, who’s also an instructor at Hunter College, says those impacted should band together to fight them. For example, tenants as a group are bigger than any racial, ethnic, or religious demographic in New York City. “Our political power isn’t anything close to our numbers. That movement is latent, and needs to grow.”