Lost in all the talk about real
estate markets and real estate wealth generation is one key fact—real estate
ownership is one of the surest ways to consolidate influence and power. If you
don’t think this is true, simply look up the largest land owners in each major
US city and follow the trail of their political contributions and donations. Large land owners can exert a tremendous amount of influence on neighborhoods and local laws. One very public example of this is Dan Gilbert,
whose mortgage and real estate empire influences the entire Midwest, but also Detroit and Cleveland in particular. Even former
president Trump, who has a less than stellar reputation in the New York real
estate market, was able to parlay a real estate empire into a presidency.
The connect between real estate
and power goes back to the first inklings of human governance. The person with
the most land typically had the most say in how governments were formed. Today
is no different. The largest land owners typically have the ability to obtain
variances more easily, influence zoning, avoid property taxes and even
influence the city plan. This influence is usually asserted through legal
tactics, like lawsuits, through para-legal methods, like lobbying and can even
be done through direct influence. One instance of direct influence that came to
light last year was the situation between Dave Chappelle and his threats to
withdraw his business from his town if they didn’t scrap their affordable
housing plans. You can read more about that situation here. Needless to say, the affordable housing was never built.
Beyond the topic of influence,
the effect of real estate policy on our daily lives is monumental. Zoning
determines the quality life of a neighborhood from how much money will be
generated, down to the types of people you will see on the street there.
Priorities are demonstrated through zoning, as are prejudices. Redlining in
lending is one clear example of this, with the situation in Flint, MI being another example. Urban
planning affects the lives of billions of people for generations and can be the
difference between a stressful, crowded and dirty city and a peaceful, tranquil
urban escape.
In light of all that having a
massive real estate empire can do for real estate mogul, it is important to
keep in perspective that every real estate portfolio starts with just one
purchase. So, be it commercial or residential, a house or a mixed-use building,
it’s important for you to start. There are so many benefits to purchasing just
one property, including the fact that it could be the beginning of your real
estate empire.
