He probably should have checked the property market before he announced this one.
I thought this article in the Financial Times was funny the other day.
So Elon Musk’s takeover of Twitter is creating all sorts of hilarious consequences, but there was one odd-ball one: a housing shortage in Dublin.
Basically, Twitter have their European headquarters in Dublin. But Dublin’s in the middle of a housing crisis.
And so when Musk says he wants to kill Work-from-Home for all Twitter employees, that creates a problem. Where are the staff going to live?
Staff aren’t happy:
At Twitter’s European headquarters, surviving employees have one big problem with Elon Musk’s demand that everyone must return to the office: finding somewhere to live.
Dublin, the Irish capital where the tech firm has an office that had about 500 employees, is in the midst of a housing crisis driven by chronic undersupply of new homes and a mass exodus of private landlords. Prices recently topped the peak they reached in 2007, shortly before an economic crash that almost bankrupted the nation.
Mr Musk’s order prompted complaints on Twitter that it’s impossible to simply move to Dublin and start working from the office.
Although staff at Dublin’s Twitter office has shrunk by about a third following the recent exodus, the spat is highlighting a growing problem for the Irish economy as it faces the prospect of recession. Dublin has flourished by creating attractive conditions for major companies to set up big offices. The city of 1.3 million will quickly lose its edge if it can’t provide housing for firms eager to get employees back to work.
It's amazing how common this story is. Many of the major cities around the world are in the middle of a housing crisis right now.
The Irish housing market got into trouble during the Celtic Tiger boom just before the GFC. But back then, loose credit created a massive construction boom, which turned into a massive over-supply of housing, which led to a collapse in prices.
But this time round, there’s a massive shortage. This article reckons there’s on 1200 properties for rent in all of Ireland!
It’s even forcing some of the big companies to build their own housing:
Some big international firms are taking matters into their own hands. A company associated with Goldman Sachs, which moved its European asset management business to Dublin after Brexit, is looking to build nearly 1000 apartments on a shopping centre car park in North West Dublin worth €400 million ($620 million). Ikea’s investment arm has committed €100 million to fund the development of more than 250 social housing units.
But this is the nature of the beast. In every nation worth living in, we just can’t build enough houses to meet demand.
And the more we build, the more people who want to come and live here.
Australia is a perfect example of this too.
But what that means prices can never ‘crash’. You need a surplus for that. It won’t happen in the middle of a shortage.
And we are locked in perpetual shortage.
And that, in my opinion, is why property is always such a safe bet.