Ikea suspends all investments in Poland

Just a quick question, didn't the law change on this? End of last week. And Ikea are going a head? I was talking to someone about it and they mentioned it had just changed.

Now we will have to start a new thread about how bad Ikea are for killing all the moma and papa shops. Just kidding.

Miranda, your economic knowledge is rather inexistant. They have tried rent regulation in Poland for over half a century and they ended up with the horrible and disgusting panelaks that r still littering the landscape.

As a rule, artificially capping a price only creates shortages. In this case the landlords would have little incentive to invest in properties (which means developers would have little incentive building them), offer their existing properties, let alone maintain the tenanted ones. In the extreme, you would actually end up with a government running the housing for the entire population, just like it was during the good old days of communism.

What you seem to loath, and rightly so, is the perceived landlords' greed. But that's simply profit seeking and that's a crucial component of a free economy. What is lacking in here is competition that would increase the offer and thus bring prices down. That's precisely where the government is failing, by creating all sorts of hurdles (zoning, red tape, tons of regulations..) before a single brick gets laid.

Trusting any government to solve a housing crisis is madness. Trusting a polish government is even worse.

PJ

not to the point that I cannot comprehand the simple rules of making a profit.


It is not perceived one. It is real. If I had a bussiness and wasn't providing the services, I would loose the customers who would go to somebody else. Correct?

The same goes for the real estate owners. I see more and more owners not looking after the property. I am not sure why. One of the reason may be the fact that they either greedy and invest somewhere else while another property is delapitating or they are not making enough profit.

I know that some of them make mistakes and let the buildings down because tha property the building is on will give them profit regardless of the condition of the building.


And rightly so. So the government ( I am not sure which one you are talking about, since you are speaking in general terms) is putting a cup of developments to a certain degree.

The funny thing about the whole discussion is Ikea provide loads of jobs in Poland , and produce goods which are exported from Poland all over the world. Poland is actually one of Ikea's main factory bases.

And what's wrong with that? If you think the landlord is charging too much then don't rent from them anymore. If the price is too high then no-one will rent. Simple facts of supply and demand.