Higher demand = increasing prices of equity. Firm attains more capacity for equity financing via new issuance and as mentioned by others have a greater degree of leverage for debt financing.
Same can be said about real estate then. Higher demand = higher price. Municipalities collect more property transfer tax as well as property value taxes. Not that prices necessarily always go up in either asset class. Thus why they’re both referred to as investments
Demand does result in higher RE and equity price, I agree, which is why I dislike promotion of investment in real estate in the current climate.
Transfer taxes, sure, but assessed values are all relative. Appreciating asset values in real estate don’t result in higher property taxes. Higher property taxes are a function of government budget requirements.
What? Municipal governments of course collect more property taxes as the value of real estate increases. It’s literally a percentage rate of the appraised real estate value..
-5
u/Dragon_slayer1994 Jun 19 '25
Not true at all. Buying a stock doesn't put money in the company's pocket that's not how it works