I thought of a term a while back for this kind of investment: "fiscal pollution."
It's when surplus savings is invested in ways that cause active harm to real people, communities, and productive businesses.
The pollution term comes in because this investment often flows from somewhere else. In the case of RE a lot of it is flight capital and money laundering. Money is being haphazardly parked somewhere that is not only non-productive but actively anti-productive. The people doing it don't care because they don't live there or are too rich to be affected, just like with many other kinds of pollution.
that seems impossible by definition? we're talking about factors that the market doesn't account for (externalities), which can't have a value because they aren't traded. what units are you going to use for magnitude?
It's when surplus savings is invested in ways that cause active harm to real people, communities, and productive businesses.
The pollution term comes in because this investment often flows from somewhere else. In the case of RE a lot of it is flight capital and money laundering. Money is being haphazardly parked somewhere that is not only non-productive but actively anti-productive. The people doing it don't care because they don't live there or are too rich to be affected, just like with many other kinds of pollution.